How Victoria’s Secret Billionaire Owner Accidentally Scored A $800 Million Stake In An AI Unicorn

Forbes

Les Wexner, the Victoria’s Secret billionaire who stepped down from his company L Brands in 2020 amid scrutiny over his ties to convicted sex offender Jeffrey Epstein, is cashing in on the AI surge.  Read the full story on Forbes: https://www.forbes.com/sites/iainmartin/2024/08/06/how-victorias-secret-billionaire-owner-accidentally-scored-a-800-million-stake-in-an-ai-unicorn/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes,

00:02How Victoria's Secret Billionaire Owner

00:04Accidentally Scored an $800 Million Stake in an AI Unicorn

00:10Lex Wexner, the Victoria's Secret billionaire

00:12who stepped down from his company L Brands in 2020

00:16amid scrutiny over his ties to convicted sex offender Jeffrey Epstein,

00:20is cashing in on the AI surge.

00:23Thanks to a $1 million seed investment in Atlantic Crypto,

00:27a little-known company that would become

00:29AI cloud juggernaut CoreWeave,

00:32the 86-year-old's family trust

00:34now holds a $720 million stake

00:37in one of the most valuable AI startups around.

00:40The Ohio-based billionaire is one of America's wealthiest people,

00:44worth an estimated $6.3 billion.

00:48Wexner's massive stake in the $19 billion startup

00:52was revealed in a lawsuit filed in the United States District Court

00:55in the Southern District of New York

00:57in May 2024 by wealth management firm Florence Capital Advisors.

01:02The New York-based money manager claims

01:04it was entitled to a $6.9 million fee

01:07for advising Wexner's family trust to invest in the startup in 2019.

01:13CoreWeave provides access to highly coveted chips

01:16used in building AI models.

01:18The company is among the most valued AI startups

01:21to emerge from the mainstreaming of artificial intelligence.

01:24It raised $7.5 billion in debt from Blackstone in May

01:29and $1.1 billion in equity earlier this year

01:32to build out a massive data center network

01:34that delivers the computing power needed to train AI.

01:38But back in 2019, it was a struggling cryptocurrency miner

01:42that had just started subletting its graphic chips

01:44to AI startups from a New Jersey garage.

01:48CoreWeave raised $1.2 million in a seed round in March 2019,

01:52according to PitchBook Data.

01:54Wexner's money manager, Greg Hirsch of Florence Capital,

01:57invested $1 million then.

02:00He later picked up another $600,000 in stock

02:02from the company's Series A round

02:04and doubled down again through an additional convertible note.

02:08All of this was placed in a trust established

02:10for the benefit of Wexner's four children,

02:13Sarah, Hannah, David, and Harry.

02:16Fast forward to 2024.

02:18Now, those investments have evolved into a $720 million stake

02:22in the AI startup that's rumored to be seeking

02:25an initial public offering next year.

02:27And it's evolved into a legal squabble

02:29over what appears to be an accidental jackpot.

02:33The spat is a rat's nest of New York finance backstabbing

02:36involving a father-son duo

02:38brought in to manage Wexner's money

02:39after Jeffrey Epstein allegedly stole $46 million

02:42from his family's trusts.

02:45It also involves a separate $100 million stake in CoreWeave

02:48made by a bankrupt hedge fund,

02:50allegations of double-dipping,

02:52and the mysterious disappearance of files

02:54containing records on the billionaire's finances.

02:57Florence Capital denies all this

02:59and insists it is owed a fee for investment advice

03:02that generated, quote,

03:03an almost unimaginable 30,986% return

03:08when Wexner sold $71 million of CoreWeave stock

03:11in November 2023.

03:13That sale, combined with Wexner's estimated

03:16remaining stake in CoreWeave,

03:18makes the total windfall from the investment

03:20just under $800 million.

03:24Wexner's CoreWeave investment coincided

03:26with a bet on data centers

03:28that increasingly undergird the AI wave.

03:31Since 2019, he's sold over $450 million of land

03:35around his home in New Albany, Ohio

03:37and in neighboring Licking County

03:39to tech giants like Google, Meta, and Facebook

03:42and Wall Street powerhouses like Blackstone

03:44that have used it to build massive data centers.

03:47With more than $15 billion

03:49in planned data center investments

03:51announced for Franklin and Licking Counties

03:53in the past year alone,

03:54according to the Washington, D.C.-based

03:56corporate subsidy tracking watchdog Good Jobs First,

03:59Wexner is well-positioned for similar deals in the future.

04:03Through his real estate development firm,

04:05the New Albany Company,

04:06he still owns some $850 million

04:09worth of farmland in the area,

04:11this according to Forbes' estimates.

04:14For full coverage,

04:15check out Ian Martin and Jemima McAvoy's piece

04:18on Forbes.com.

04:21This is Kieran Meadows from Forbes.

04:23Thanks for tuning in.

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