Interview
Eclipse's Lior Susan on $12.5B AUM and the Bet on Physical Industries
- Eclipse is a venture firm with $12.5 billion AUM (figure subject to growth) operating since 2015, characterized by its founders as "operators with capital" rather than traditional venture capitalists.
- The firm focuses exclusively on physical industries, leveraging the fact that approximately 85% of global GDP, totaling roughly $100 trillion, resides in the physical economy.
- Eclipse has recently announced two successful Initial Public Offerings (IPOs) within its portfolio: Cerebras (semiconductors) and SpaceX (space), both performing strongly.
- Founder Lior Glicksman's investment thesis is rooted in the necessity of onshoring and deglobalization, citing China's $20 trillion economy built on the "five forces" of talent, policy, capital, technology, and demand as a competitive benchmark for the US.
- The firm manages a total of 90 companies, including 30 incubated entities, including Bright Machines, Bedrock, Mitra, and Peak Energy.
- Co-founder Pierre has served as a mentor and operator for 7 years; at age 85 when they met, he brought 35 years of institutional experience from Sequoia Capital, instilling a culture of strict discipline and hands-on operational oversight.
- Eclipse's incubation strategy involves building companies internally to maintain fresh operating skills and solve complex industry challenges, a model driven by the belief that physical companies require deep expertise in CapEx, supply chain, and engineering that passive capital cannot provide.
- The firm recently raised its latest fund, split between two vehicles, totaling $1.3 billion.
- Eclipse views the current market as a "second act" or "third act" opportunity for physical industries, citing Redwood Materials' evolution from recycling to energy storage and Cerebras' shift from chip design to building systems and data centers.
- The firm defines its portfolio strategy around an "Eclipse Economy," creating a vertically integrated ecosystem where capital deployed in one area (e.g., chips) leverages value across others (e.g., energy, manufacturing, and data centers).
- Eclipse argues that traditional SaaS metrics like gross margin are misleading accounting tricks, advocating instead for Free Cash Flow (FCF) and EPS as the primary indicators of a company's fundamental health.
- The firm operates on a high-conviction, high-capex model, noting that the semiconductor memory market, for instance, has only three major players due to massive capital and engineering barriers.
- Eclipse has secured roughly $40-50 billion in commercial deals across its portfolio in the last year, including tens of double-digit billion-dollar transactions.
- The firm is actively shaping AI policy and infrastructure, having contributed to the drafting of the AI Act and collaborating with the administration on data sovereignty and on-premise computing frameworks.
- A specific "war story" highlights the firm's hands-on approach: Lior flew to the Midwest within 72 hours to personally troubleshoot a massive water cooling leak at a portfolio data center, spending three days on-site without his family.
- Portfolio companies include Oxide (on-premise CPU-based racks), Vulcan Forms (metal manufacturing), True Anomaly (space defense), Redwood Materials (battery recycling and storage), and Anduril (defense AI).
- The firm sees significant growth potential in energy infrastructure, including nuclear, sodium-ion, and modern gas turbines, driven by the insatiable demand for AI compute power.
- Lior's personal background as a banana farmer in Israel provided early discipline and his first experience with welding and physical manufacturing, solidifying his passion for building tangible products.
- The firm expects a 5-7% annual GDP growth rate for the US, driven by the "Eclipse Economy" flywheel of manufacturing, energy, and infrastructure creating jobs and service demand.
- Lior cites Sam Altman of OpenAI as a personal inspiration, praising his character and the foundational role of AI models like ChatGPT in enabling new societal and economic capabilities.