Insight Partners’ Devin Parekh Defends Diversified Tech Strategy Amid AI Valuation Surge

Devin Parekh, who has co-managed software investment giant Insight Partners for 26 years, detailed the firm's investment philosophy during an interview at TechCrunch's recent StrictlyVC event in New York. Managing roughly $90 billion in assets, the New York-based firm maintains a lower public profile than many of its Silicon Valley counterparts, preferring to let portfolio metrics dictate its market reputation.

Addressing broad industry concerns regarding artificial intelligence safety and risk, Parekh characterized the technology's potential benefits as overwhelming, particularly within healthcare. Serving on the board of NYU Langone, he noted that machine learning models analyzing 50 million patient records can identify elevated heart attack risks early, arguing that scalable AI tools are vital to support aging global populations facing shortages of medical professionals.

Insight Partners deploys capital flexibly across early-stage venture, growth equity, buyouts, and secondaries, though Parekh noted buyout activity has stalled since 2024 due to high interest rates, tight debt markets, and compressed software valuation multiples. Responding to rapid valuation expansion across the startup ecosystem, Insight has leaned into earlier-stage investments, issuing initial checks between $20 million and $25 million before increasing stakes in high-performing companies, similar to its early backing of cybersecurity firm Wiz.

The firm holds positions in competing artificial intelligence frontrunners OpenAI and Anthropic. Parekh explained that dual backing becomes practical at later investment stages where investors hold non-governance stakes without board seats. Addressing concentration risks in venture capital, Parekh acknowledged that while some peer funds direct up to 40% of their vehicle capital into single AI labs, Insight's 13th fund prioritizes long-term diversification over concentrated exposure.

On global founder talent, Parekh observed that technical expertise has decentralized across regions. He highlighted Insight's attempt to win legal-technology startup Legora, where partner Jeff Horing traveled to Stockholm before losing the deal to General Catalyst. However, Parekh noted that core AI infrastructure engineering remains heavily concentrated in San Francisco, whereas domain-specific verticals like financial technology remain centered in hubs such as New York.

Emphasizing capital returned to limited partners, Parekh stated that Insight has returned more than $20 billion over the past two years through strategic software sales and public listings. He cited the firm's strategy with enterprise security platform Armis, where an initial $5 million commitment from an $11 billion fund later turned into a full cap table buyout and a subsequent $7 billion sale to ServiceNow earlier this year. He also pointed to enterprise AI agent platform Wonderful, which reached a $5 billion valuation within two years of founding.

Looking toward liquidity across the tech sector, Parekh anticipated a series of mega-cap public debuts over the next 18 months, pointing to potential listings from Anthropic, OpenAI, and SpaceX. He warned founders against expecting parabolic growth rates to compound indefinitely, encouraging company leadership to take partial secondary liquidity during frothy valuation cycles to protect against eventual market adjustments.