Southern Ontario (Toronto/Ottawa/Waterloo) is the biggest sleeper corridor in the History of Computation.
Pioneered: first internet search engine (OpenText), compilers (Watcom), Elliptic Curve Cryptography (Certicom), GPUs (ATI), smart phones (RIM/Blackberry), Optical Networking
Data from Carta suggests seed valuations are very near all-time highs
We see this ourselves, despite the Seed-> Series A conversion being at all-time lows
Wacky market
OpenAI's unique structure could drive this strange decision-making
The for-profit is an LLC, LLCs are not governed by Delaware C-Corp law
The for-profit is governed by the non-profit board, which is bound by the charter. One of the charter principles is long-term safety.
It
One of the more surprising things I've learned in venture is that "reputation" often doesn't catch up to you
I know many VCs who act unethically, lie, or abandon companies that I see with a good brand and winning competitive deals
Few people do real reference checks
My advice to new investors: Prioritize opportunism to secure investments in top-tier companies by any means necessary
I see too much focus on valuation caps or ownership targets. If you find a generational company; just get in. Be flexible with ownership stakes, consider
Excited to be investing again in
@ScottWu46
and the
@cognition_labs
team after knowing Scott for nearly a decade
Have been blown away by the product. The capability slope is incredible, and believe the UI will inform how future AI-native apps are built
Greg is one of the greatest technologists of our time. This is a monumental loss to the company, which was perfectly positioned to capitalize on the defining tech of our generation
It suggests there probably isn't a huge *for cause* scandal
Greatest own-goal in startup history?
@McFaul
Michael, this is a silly argument and you know it. US Citizens should have an interest in what their government does more than what another does.
You know “whataboutism” is a poor argument. Do you think the use is a war crime? As someone who has family in a prior war zone, I do!
We’re in the “grind it out” phase of the venture market.
Let’s see who on both sides of the table has the stamina and expertise to really build for the long-term.
Moves like this cement the fact that
@anduriltech
is a generational company.
Defense is complex. You should be a multi-product company to recognize maximum value.
This is a super strategic and smart acquisition that will enable many more products.
Startups who were able to maintain a war chest have had their runways extended meaningfully by high interest income
Really incredible how material it is to many companies
You can run a medium-sized team on the interest from a Tiger round
Happy July 4th to everyone! Incredibly proud to be an American this 4th. Still love Canada too :). Both countries have been foundational to me.
But American has given me opportunities I could have never dreamed of and today is it's day. Unapologetically proud. 🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸
The talent density
@OpenAI
has is insane. Legends leave semi-regularly and they still have the best team by a wide margin.
I hope
@gdb
can stick around and be like
@JeffDean
. When you can retain great technical minds for decades at a time and give them long-lived resources you
Oat milk is gross and tastes like chemicals
The fact that Blue Bottle defaults to using oat milk and accidentally prepares my latte with it, despite my requests otherwise, makes me not want to go there
Last week the head of Gradient Ventures announced she will be leaving
There is a ton of hidden VC turnover that is not yet announced
Firms are bloated with the new normal in dealflow. Some GPs don't want it grind it out in a new cycle
Big changes ahead
Every quarter I’ll be publishing my thoughts on the venture funding markets + macro + startup musings. For Q3, I outline how I think our new normal is just the old normal of 2018 — we are unlikely to see any improvement in funding markets for some time.
@DavidSacks
Find it quite distasteful to see foreign dignitaries criticizing American citizens for sharing what they see is the American interest. Americans are the right to debate the predominant American interest in this situation, whatever it may be, without foreign influence
There's wild 2021-level stuff going on in the growth markets
Huge amounts of dry powder are meeting a (lower) supply of great companies, and it's 2021 multiples all over again
@SCOTUSblog
Seems like a poor decision, I only consume your content via Twitter. I hope you reconsider or offer a subscription offering to offset the $8/month.
Or you can use the platform without the blue check!
Excited to present my latest Q4 2023 - State of Venture Update & 2024 Outlook: "80% Growth is the New 200%".
In this update, I explore the dynamic shifts in AI, inflation outlook, changes in the Venture Capital market, and BioTech as we enter 2024.
Have to say my favorite thing about NewSF is that it’s highly technical engineers/founders on the grind again
Get excited on a weekly basis with people just hacking cool shit
Not as many tourists as we had peak bubble
Back to like when I moved here 15 years ago
Protectionism/cronyism in Canada is something I've fought for many years. Canada is a great but has policies which protect the establishment over average Canadians and immigrants.
The dairy quota is one of the most egregious. They'd rather dump milk than feed hungry families.
We need to fix this.
The deindustrialization of Europe is coming about due to the Ukraine war. It's external.
Canada by nature should be a rich country. Natural resources, stable institutions, education, free access to the largest economy
Canada should be as rich as the US
This is a pretty pivotal and important moment. Contracts like this don't often go outside of the major primes.
Anduril is a category leader, and doing it in style!
The
@usairforce
has selected Anduril to design, manufacture, and test production-representative Collaborative Combat Aircraft (CCA).
In this era of great power competition, there is no time to waste on business as usual. We look forward to delivering CCAs on schedule, within
Posted my Q1 2024 State of Venture Update - From Devin to Robotic Foundation Models: AI's Transformative Potential
I give updates on the venture market, what Devin teaches about AI-first application software, Robotics, LLM model convergence, and more...
Difficulty hiring engineers in the SF Bay Area has continued to increase exponentially. I’ve never seen it this bad, almost every company I know has opened a second engineering office which grows significantly faster than SF. It’s becoming table stakes.
@JoinTerminal
@jackabraham
Excited to host
@amasad
for a fireside chat at our next Chat8VC event August 9th at 6:30pm in our SF office. Demos to follow.
If you're interested in LLMs & Replit, please join us!
@8vc
Late in my career, I learned the power of a good board: it can be a competitive advantage
Focus adding independent members that value, and you'll gather a team that boosts your company in ways you couldn't by hiring alone—offering guidance, connections, and credibility
With these new model releases, we're seeing some serious convergence in LLMs across providers. That's making switching costs near 0.
Let's say this continues (it may not with GPT-5 or more infra built by providers), what's the right analog for the business?
I always thought
Thought I'd try this myself and it's pretty funny.
As a student of Serbian history I can tell you there are some errors here, haha.
I'm 100% bought into the intent, but something went wrong in the training steps.
Alloy is building the platform layer to democratize drug discovery (antibodies today). It has a broad and positive-sum mission to make development partnerships high-impact and low-friction. So happy to be involved, may the best drug win!
@errikanderson
Contrary to popular belief, AI is likely to boost all wages, not decrease
In AI-enhanced sectors wages will rise as wages follow the marginal productivity of labor
In non-productive sectors, Baumol’s Cost-Disease means those wages will also rise
AI will be wage-enhancing
i am hearing reports that the personnel issues that led to the board's actions involved discovery of a group of researchers secretly training the new GPDeez model without the board's knowledge. the board reportedly went nuts after finding out about this
The "let it fail" crowd neglects to understand that we all know there are a few banks "too big to fail"
Inaction leads to concentration in big banks at the expense of regional banks
Actions can be taken that will cost taxpayers nothing but save the system, but window is closing
SF Is back and seems like it got an upgrade. Everybody is here or always coming through town, yet there's very little traffic and you can always find parking.
Wow Tiger raised a new fund! Have to respect the hustle and ability to stay in the game.
Venture fund brands may have a longer tail of life than mainframes or legacy dbs. There truly is no such thing as bad publicity.
Building product is one of the more sustainable and least-recognized moats in software. Above switching costs & other types of vendor lock-in. Launch good product at a fast pace over time and your competitors can never catch up without a major platform transition.
Today is my birthday, so I decided to birth something fun and useful we’ve been working on.
Introducing
@MeetBoardy
, the AI board member you deserve.
Over the years, I’ve had great board members and not so great board members, but one thing was always true: every single one was
Wow, Devin from
@cognition_labs
is impressively good/capable
The knowledge-work that will be addressed by AI-enabled control panels in the next decade are going to be incredible
Like looking into the future
Heartwarming story from
@8vc
portco
@OrcaBio
. Mikhail Rubin needed a stem-cell transplant but was too old for most cutting-edge therapies. It so happens his son-in-law Nate started Orca which was used to save his life!
Immigrants are the most dynamic part of our economy and the current administration seems to prefer hollow rhetoric over action.
Almost every single aspect of the system has unreasonable delays (Visas, Naturalization, Residency) and quotas are unchanged.
We can do better!
Thread: for 2+ years the State Dept. has been bungling the US visa system. The wait time in New Delhi for a tourist visa is >800 days!
Are we supposed to just accept gross government incompetence nowadays?
In tomorrow’s
@WSJ
I argue that we shouldn’t...
@absoluttig
Interesting -- the value-capture point may be correct. But I think you are overvaluing the present reality of model training cost vs projecting cost curve improvements.
Over time compute will get cheaper and model training-efficiency will improve. Even over the past year we've
Congrats to
@casetext
team &
@Jacob_Heller
on the acquisition by Thomson Reuters
Jake and team are some of the most dedicated and forward-looking entrepreneurs I've ever worked with. They've worked on AI in legal tech for many years. Always ahead!
It seems the majority of inflation relief in the US is coming from the fact that every developed economy is close to recession (driving goods deflation)
Seems misguided for the Fed to pivot with this backdrop as the US economy and the federal deficit is still RED HOT
I see many people not understand the idea of Paid-in-Capital (PIC) in the context of market capitalization. Taking $15b to create a $4b company is not particularly exciting. Many companies now are trading where MktCap < PIC -- destroyed value. $WE $COMP
It's strange to see attacks early-companies are getting when they admit early employees have to work a lot. Startups are hard and the default mode is failure. The only advantage is speed and hustle. Most people have the option of a big vs small company, small means hard work
@McFaul
I'm not a international lawyer either so my point was more of a moral one than a legal one (it should be illegal, but it probably isn't).
The issue is their remnant effects on the civilian population well past the end of the war. Which is why most of our allies in the civilized
Happy July 4th!!! Very thankful to the country for taking me in a decade ago. Proud to celebrate the opportunities it has provided and great friends I’ve been able to make. 🇺🇸🇺🇸🇺🇸🚀🚀🚀
Software multiples seem to have stabilized over the past quarter. My view is that we are 1-2 quarters away from a bottom -- probably another ~20-25% decline ahead. We'll see an earnings-recession early next year (when it gets very bad) as the bottom. Cos need to get through 2023.
Biotech VC markets are some of the most inefficient private markets in the world
Dearth of capital for mid-stage non-incubated companies
Valuations are haphazard and often priced off of the last post (not comps)
Insider bailouts
Big opportunity for a new fund in 1-2 years
After missing as a first-mover in LLMs, Zuck/Meta's strategy seems to be to salt the earth for anyone looking to monetize base foundation models
Respect the vindictiveness and happy for the push towards Open Source
Really incredible results coming out of DeepMind. "Solving olympiad geometry without human demonstrations". Solved 25/30 Olympiad-level problems within the competition time-limit.
Amazing with such a small team.
I think a major reason companies initially overestimated remote-work productivity is we conflated WFH during a pandemic with WFH in a normal world. They are different environments and we can't expect productivity to be equal
The
@hume_ai
demo is a cool POC for emotion-aware LLM voice interaction. Could be a good basis for a digital assistant.
Rough around the edges but pretty impressive they got the latency down to being almost imperceptible.
h/t
@rauchg
for flagging
Imagine your biggest investor being a “low grade antagonist” who says “anti-focus ain’t cheap”…Uber with Eats and global at $150b would have been Lyft at $7b! No great entrepreneur can ultimately work with a catastrophist. Always ends badly and sadly.
The level of engagement I see on both sides of the table with in-person pitches vs virtual is stark. It should be a serious consideration when fundraising to give the pitch in-person again. Zoom saves time but your hit rate will likely be lower. Same with boards.
Many young investors err by overestimating how easy it is to sell a business and its value, leading to unwise funding decisions.
Selling a company, especially at the desired time, is challenging.
Achieving compelling value proves to be the exception rather than the norm.
Happy to be able to publicly announce Resilience, a collaboration between
@8vc
,
@rtnarch
, and the Resilience team. The company was started to improve biomanufacturing technology, quality and supply-chain resilience!