Justin Ernest deployed nearly $500 million into hot startups using SPVs, bypassing traditional VC funds

Last year, Justin Ernest identified a critical gap in venture capital: family offices and smaller institutional investors were eager to invest in fast-growing AI companies but were excluded from their cap tables. Having spent over five years at Playground Global, where he honed his fundraising skills and deep tech expertise, Ernest was confident that his network could bridge this divide. Rather than launch a formal VC fund—a process that typically takes new managers 12 to 18 months—he secured stock allocations in high-profile later-stage companies. He then offered these deals to about 30 smaller investors via special purpose vehicles (SPVs), single-asset funds, and nominee structures. Over the last 12 months, Sabertooth Capital has invested nearly $500 million into 10 companies, including Anthropic, Anduril, and SpaceX. Each deal is treated as a separate fund, often structured as an SPV. Checks have ranged from $10 million to $275 million, and all investments were made in official funding rounds. Benjamin Wagner, a CIO for a family office, praised Ernest as an authentic investor with strong judgment and technical knowledge. Wagner noted that PsiQuantum’s CFO directed him to Sabertooth, which validated Ernest’s legitimacy. Ernest’s solid reputation has been earned partly through his technical background—he is a Harvard Business School graduate who overcame a childhood speech impediment—and his strategic use of his network. He can typically secure capital from his LPs after just four or five phone calls. Sabertooth has already seen one major return from Groq, acquired by Nvidia for $20 billion. Upcoming events include SpaceX’s IPO this Friday and Anthropic’s expected public listing. Although SPVs lack the prestige of traditional funds, Ernest believes they are the right strategy to prove his track record before eventually raising a traditional venture fund. He stated, “I think this will end up being one of the best vintages of our lifetime.”