While you’re busy Ghibli-fying your images with ChatGPT’s new image-generation capabilities, OpenAI is out raising a ton more cash. The company is close to finalizing a new $40 billion funding round led by SoftBank, according to a report from Bloomberg. The report noted that other funds, including the hedge fund Magnetar Capital, Coatue Management, Founders […]
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Microsoft adds AI-powered deep research tools to Copilot
Microsoft is introducing a “deep research” AI-powered tool in Microsoft 365 Copilot, its AI chatbot app. There’s been a raft of deep research agents launched recently across chatbots, including OpenAI’s ChatGPT, Google’s Gemini, and xAI’s Grok. Powering them are so-called reasoning AI models, which posses the ability to think through problems and fact-check themselves — […]
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Daphni secures $215M for its third fund
French VC firm Daphni is announcing the first closing of its new fund, Daphni Blue. The firm has raised €200 million (around $215 million at current exchange rates). It expects to raise as much as €250 million ($270 million) by the end of the year. Some of Daphni’s most remarkable past investments include Back Market, […]
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Future of the AI Age
Embracing the Future: Navigating the Age of Artificial Intelligence
As we stand on the brink of a new era, the Age of Artificial Intelligence (AI), we find ourselves at a unique crossroads in history. The advancements in AI technology have already begun reshaping our lives, workplaces, and global systems. But what does the future hold in this fast-evolving landscape? Let’s explore the potential developments, challenges, and opportunities on the horizon.
The Rapid Evolution of AI
AI has evolved rapidly over the past decade, driven by breakthroughs in machine learning, natural language processing, and neural networks. From self-driving cars6 to virtual personal assistants, AI is already embedded in many facets of our daily lives. As we move forward, we can expect even more sophisticated applications:
Enhanced Personalization: Businesses will leverage AI to offer hyper-personalized experiences. From tailored marketing to individualized healthcare plans, the ability to analyze vast amounts of data will revolutionize customer engagement.
Autonomous Systems: The development of autonomous vehicles, drones, and robots will transform transportation and logistics. Imagine a world where traffic congestion and accidents are significantly reduced, and delivery systems become faster and more efficient.
AI in Healthcare: AI’s role in healthcare will expand dramatically. From predictive analytics that improve patient outcomes to AI-powered diagnostic tools that enhance accuracy, the potential to save lives and improve overall health is immense.
The Workforce Transformation
As AI continues to advance, it will undoubtedly impact the job market. Some may view AI as a threat to employment, while others recognize its potential to create new opportunities. The key will lie in adaptation:
Automation vs. Augmentation: Certain jobs may become obsolete due to automation, but AI will also augment human capabilities. Professionals will need to reskill and upskill to work alongside AI, focusing on tasks that require creativity, emotional intelligence, and critical thinking.
New Job Categories: The rise of AI will give birth to entirely new job categories that we can’t yet imagine. Roles such as AI ethics consultants, data curators, and machine learning trainers will emerge, highlighting the need for a workforce that is adaptable and ready for change.
Ethical Considerations and Challenges
As we embrace the Age of AI, we must also confront the ethical implications that come with it. Questions regarding data privacy, bias in algorithms, and the accountability of AI systems are paramount. The following considerations will be crucial:
Regulating AI: Governments and organizations must develop robust regulatory frameworks to ensure that AI is used responsibly. Striking a balance between innovation and regulation will be essential to foster trust and protect public interests.
Addressing Bias: AI systems are only as good as the data they’re trained on. If not addressed, issues surrounding bias can lead to discriminatory outcomes. Ongoing efforts to diversify data sources and establish fairness protocols will be vital.
AI Ethics and Governance: Establishing ethical guidelines for AI development and implementation is a pressing need. Industry leaders, policymakers, and technologists must collaborate to create a framework that prioritizes humanity’s well-being.
The Promise of Collaboration
The future of the AI Age is not a solitary journey; it will require collaboration across borders and disciplines. The most successful innovations will emerge from partnerships that bring together diverse perspectives and expertise. Collaboration can lead to:
Global Solutions: Tackling the world’s most pressing challenges—such as climate change, public health crises, and economic inequality—will rely on AI’s power, coupled with collective human ingenuity.
Public Engagement: Fostering a dialogue between technologists and the public is essential. Educating individuals about AI, its implications, and empowering them to participate in discussions will create a more informed society ready to embrace the future.
Conclusion
The Age of AI promises to be transformative, offering unprecedented opportunities alongside significant challenges. As we navigate this new landscape, a proactive approach will be essential. By prioritizing education, ethical considerations, and collaboration, we can harness the potential of AI to enrich our lives, drive innovation, and create a better future for all.
As we look ahead, let us embrace the possibilities of AI with optimism and responsibility. The future is here, and it’s up to us to shape it.mited plan. -
What Mistakes Do VCs Make When Fundraising?
A few weeks ago, I had the pleasure of talking to Samir Kaji on the Venture Unlocked podcast about a wide range of topics that we as venture capitalists think about everyday, including:
- How to build a generational firm — retaining partner talent and finding the complimentary networks and skillsets firms need to succeed over time
- The state of venture today and how COVID crammed 10 years of technological change into one accelerated year
- The human psychology of decision making and one book I think every VC should read
- How to get LPs to become true believers and why I think data rooms are where deals go to die
Mark Suster of Upfront Ventures
And much more. You can listen to the entire conversation above or via this link, but I also wanted to highlight one topic we discussed that I feel strongly about, which is how I think enterprise sales and venture fundraising are basically the same muscle. Let me explain.
Three Rules of Fundraising “Sales”
One of the common mistakes I see startups as well as VCs make is spending too much time on top of funnel prospecting. Why? Because it’s comparatively easier to have a first meeting, meet each other, share stories, etc. than it is to start narrowing down and doing the work to close the deal, or risking hearing a no. But here’s the thing — it’s not just startups who do it. We all do it on this side of the table too. LPs, VCs, everyone. We love first meetings! It’s the mid and bottom funnel that’s hard.
In fact, I wrote a previous blog post on “Why Successful People Focus on the Bottom End of the Funnel.”
I counsel first-time VCs (as well as founders) to have mid-funnel strategies to get from first LP meeting to close and to put a disproportionate amount of time into this area (I say more about this on the podcast starting at timecode 27:41). Like any enterprise sale, you want to think from the perspective of the buyer and what they need to feel confident about the decision to buy a stake or ownership in your fund.
Here are the three rules I think about in any sale, whether it’s enterprise sales or when trying to move LPs to a decision, there are three keys you need to be able to answer:
- Why buy anything?
- Why buy me?
- Why buy now?
Why Buy Anything?
When raising a first fund (or a fifth or even a tenth), it’s all about establishing your core target market and finding out who is in the market for what you are selling? Whilst there are a wide range of LPs and you could have first meetings for months (and many VCs do), there is probably a much smaller number of LPs who want to invest in a fund your size, with your focus, and whose minimum or maximum check size lines up with what you’re seeking.
So I encourage first-time fundraisers to qualify, qualify, qualify. Do the legwork to find the people who want to buy specifically what you’re selling. Research everyone who has raised a comparably-sized fund and find out who backed them — that’s your target market. Every other conversation will be wasted time, and just like an enterprise startup, wasted time is an existential threat.
Why Buy Me?
OK, so you’ve found your target LPs who invest in funds at your stage. Now it’s time to convince them why they need to invest in your fund, when they could invest in other funds with more proven returns or partners. And again, just like in enterprise sales, this is all about differentiation — what makes you different and complimentary to all the other funds in their portfolio? What’s your unique selling proposition?
For Upfront, it’s about Los Angeles. We invest 40% of our dollars in Southern California firms — and even though by definition that means the majority of our dollars are invested outside the area, that still makes us meaningfully different from the ten other Sand Hill Road funds this LP might be speaking with. We’re definitely not a “regional investor” but we do have some comparative advantage in a good portion of our deals.
It’s critical to stand for a firm differentiator and here’s why: it shines a clear spotlight on whether you are or are not a good bet for this LP. If you do everything that every other firm does, in the same ways, why should they buy you? And yes — a firm differentiator means that not everyone will buy into your thesis but that’s okay. You don’t need everyone, you just need a few core believers and having a hard “why buy me” pitch makes it easier to find and convert those leads.
“Why buy me” is also a good time to leverage references and external people who can vouch for you, who can champion who you are and why you’re a good bet. Everyone loves to know that someone else has bought first, and LPs are no different.
Why Buy Now?
This can be the hardest of the three rules to sell whether you’re in enterprise sales (“why buy this now when I can wait until you have more traction, more logos, more product features?”) or whether you’re raising a fund (“why invest now when I can see how your first fund turns out and come in for the next one?”)
This is all about creating scarcity and being willing to walk away, but doing it with a smile on your face. For Upfront, we raise consistently sized funds and have been fortunate to have LPs with us fund after fund, whether in our core A fund or our growth funds that support some of our most promising investments. That means there’s not a lot of room to bring in new investors down the line, and hopefully that’s true of first-time funds as well — they do so well that the second fund is oversubscribed. Any customer, whether an LP or a big enterprise buyer, needs to know that there’s a chance they could miss out.
You can hear more about these three rules and more in my conversation with Samir — it was a fun one to do and I hope you’ll enjoy it as much as I did.
What Mistakes Do VCs Make When Fundraising? was originally published in Both Sides of the Table on Medium, where people are continuing the conversation by highlighting and responding to this story.