When Donald Trump Jr. joined 1789 Capital as a partner, Wall Street assumed the venture firm was building a conservative media boutique. They were wrong. Over the past eighteen months, 1789 Capital exploded from a modest $200 million fund into a $3.5 billion private equity vehicle that sits directly at the intersection of venture investing and federal procurement. The firm did not just back alternative culture brands. It aggressively moved into defense manufacturing, artificial intelligence, critical minerals, and aerospace, accumulating portfolio companies that subsequently secured hundreds of millions of dollars in federal loans and Department of Defense awards.
Power in venture capital usually stems from proprietary technology or exclusive access to elite founders. In Palm Beach, a different model emerged. 1789 Capital proved that political access and regulatory alignment can yield extraordinary capital growth, creating a blueprint that blurs the boundary between private investment and public governance.
The Financial Architecture Behind 1789 Capital
Co-founded by Omeed Malik, Chris Buskirk, and conservative megadonor Rebekah Mercer, 1789 Capital launched in 2023 with a mission to counter traditional ESG investing. The fund initially targeted what it called "patriotic capitalism," funding ventures that rejected progressive corporate mandates. Early bets included Tucker Carlson’s media venture and Second Amendment-focused digital platform GrabAGun.
Then came the late 2024 hiring of Donald Trump Jr.
His arrival transformed the fund’s trajectory almost overnight. Institutional capital flowed in at an unprecedented rate, pushing assets under management past the $1 billion milestone in late 2025 and surging to $3.5 billion by mid-2026. The firm opened a private members' club in Washington, D.C., establishing a physical outpost where tech founders, conservative donors, and political strategists convene over private allocations.
This growth did not happen in a vacuum. The firm shifted its primary strategy away from consumer apps and online forums. It began writing massive checks to late-stage technology providers, dual-use defense startups, and heavy industrial operations.
When Venture Bets Meet Federal Treasury Funds
The core mechanism driving 1789 Capital's rise involves an alignment between its portfolio companies and federal policy shifts. When a venture fund takes an equity position in an industrial firm shortly before that firm receives major government backing, institutional investors take notice.
Consider the case of Vulcan Elements, a startup specializing in domestic rare earth magnet manufacturing. In August 2025, 1789 Capital took a significant equity position in Vulcan as part of a $65 million funding round. Three months later, the Pentagon’s Office of Strategic Capital committed a $620 million loan alongside a $50 million direct equity injection into Vulcan Elements. The commitment represented the largest single financial backing package in the history of that Pentagon office.
The transaction raised immediate questions on Capitol Hill. Executive Order 14241 had streamlined critical mineral acquisition rules, waiving certain competitive bidding requirements and standard technical disclosures previously used to verify project viability. Congressional oversight committees noted that the $620 million loan exceeded Vulcan’s entire valuation at the time 1789 Capital invested.
Similar patterns unfolded across the broader portfolio.
- Cerebras Systems received $45 million in defense awards aimed at improving artificial intelligence hardware processing.
- PsiQuantum secured $10.8 million in federal funding for quantum computing development.
- Firehawk Aerospace obtained a $4.9 million contract to accelerate solid rocket motor production.
Total federal contracts, loans, and commitments to companies backed by 1789 Capital surpassed $735 million within a single calendar year.
The Conflict Mechanism and Congressional Scrutiny
Public officials routinely hold private wealth. Yet the speed with which 1789 Capital portfolio companies obtained government backing created a fierce political response.
Senate lawmakers led by Elizabeth Warren and Richard Blumenthal formally requested Department of Defense documentation regarding contract awards to 1789 Capital portfolio entities. Their inquiries focused on whether presidential family involvement altered standard procurement metrics or short-circuited traditional vetting.
House Natural Resources Committee Democrats forced a vote to subpoena Donald Trump Jr. regarding the Vulcan Elements deal, pointing out that public money was deployed into a company where the president's son held an indirect financial stake. House Republicans voted down the subpoena request, maintaining that the investments represented legal, private transactions that strengthen domestic supply chains.
The broader ethical issue rests on structural access. When a partner at an active investment firm participates in high-level personnel screening or political messaging design for an incoming administration, the line between policy advice and commercial advantage becomes thin. Portfolio companies benefit from knowing exactly where federal spending priorities will land before public solicitations are printed.
Beyond Defense and into the Tech Hierarchy
The firm did not limit its holdings to defense hardware. 1789 Capital systematically accumulated equity in the dominant private companies of the decade.
The firm acquired equity in nearly every major enterprise controlled by Elon Musk, including SpaceX, Neuralink, X, and xAI. It took positions in autonomous defense manufacturer Anduril Industries, high-speed chipmaker Groq, and computational search provider Perplexity AI.
This strategy serves two purposes. First, it gives the fund blue-chip credibility that traditional institutional limited partners respect. Second, it embeds 1789 Capital directly into the supply chains that supply federal agencies with next-generation technology.
When defense tech firm Anduril rolled out its YFQ-44 autonomous combat aircraft—designed to fly alongside human pilots without onboard operators—1789 Capital was already positioned as an investor. When Groq completed a multi-billion-dollar computing agreement to supply hardware infrastructure, 1789 Capital captured the equity upside.
The fund also branched out into real estate, raising $1 billion for a fund focused on commercial space, medical facilities, and residential build-outs in Florida and Texas. The thesis hinges on long-term demographic shifts away from high-tax states toward southern regions with lenient corporate regulations.
Why the Model Will Be Copied
Critics call 1789 Capital a textbook example of political access monetized into asset management. Proponents counter that traditional Silicon Valley firms have leveraged political connections in Washington for decades through defense tech funds and political action committees.
The reality is simpler. 1789 Capital demonstrated that explicitly political venture funds can achieve rapid scale if they capture real-world government contracts rather than relying solely on retail consumer enthusiasm.
Venture firms historically competed on term sheets, founder network access, and operational advice. Today, access to state-backed capital allocations and regulatory waivers forms a new frontier in private markets. Wealthy family offices and international sovereign wealth funds watch these returns closely. Capital flows where policy dictates, and right now, policy flows directly through 1789 Capital.
