Zoom to Salesforce: How Emergence Capital Picks Billion-Dollar Winners

Thrilled to share our interview with Founding GP Gordon Ritter & newly promoted Partner Yaz El-Baba of $2.3B AUM VC fund Emergence Capital. Aka legends. We cover everything from the state of VC, IPO window, Stargate, the macro environment, AI’s growth, the app layer to infrastructure, which Founders win the AI race, preventing the AI plateau, to Emergence’s history & evolution.

Oh, and Yaz’s hot take on 1-person billion-dollar AI companies. 👀

→ Listen on Spotify, YouTube, Apple

Emergence Capital is a venture capital firm known for its specialization in early-stage investments in enterprise cloud software companies. The firm's focus is on businesses that leverage technology to improve workplace productivity, business outcomes, and the customer experience. Emergence is widely regarded as a pioneer in the SaaS (Software-as-a-Service) space and has backed some of the most successful companies in the category, such as Salesforce, Veeva, Box, Yammer, Bill.com, Zoom, Blend, and Doximity.

Founded in 2003, Emergence Capital operates with a philosophy of fostering long-term partnerships with entrepreneurs and helping them build world-class companies.. this has shaped out to:

Stats:

• $450B+ Market Cap of Portfolio (current and former)

• $2.3B AUM

• Six (VI) Funds

• 100+ Portfolio Companies

• 20 Exits and Private Valuations Greater than $500 Million

Notable Investments:

• Salesforce (CRM) software giant: $328B

• Veeva Systems (VEEV) cloud solutions for life sciences): $38B

• Zoom (ZM) video conferencing leader: $27B

• Doximity (DOCS) workflow tools for clinicians: $11B

Market caps as of January 30th, 2025

Fresh Funding:

Yaz & Gordon’s recent $40M Series B investment: Bland

Bland, the hyper-realistic conversational AI platform, sounds human, speaks any language, and works 24/7.

Bland makes defining and directing voice experiences easy. Design pathways—map conversations, set flows, and automate millions of calls, 24/7. Customize your agent’s personality, choose or clone voices, add languages, and let Bland adapt like a top employee on every call. Voice tech is hard—Bland makes it simple.

→ Watch their announcement clip:

→ Read their thesis on Bland

More on Gordon & Yaz’s track records, Emergence’s portfolio & theses, and extras below.

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Timestamps:

0:00 - Welcome Yaz & Gordon!

1:20 - Current State of VC

6:45 - Emergence's IPOs, Salesforce, Zoom, Bill.com

10:00 - Veeva $37B story

18:10 - Stargate $500B Investment In AI

29:50 - Well Satya, Is SAAS Dead?!

32:30 - Together AI

38:40 - Which Founders Will Win Today?

41:00 - The AI Plateau

58:00 - How Marc Benioff Helped Start Emergence

1:13:40 - Bland Investment Announcement

1:16:00 - 1 Deal That You Regret

1:17:50 - Yaz & Gordon's 2025 Outlooks

Founder + General Partner, Gordon Ritter

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“The right focus is the constant that achieves unimaginable goals.”

Gordon Ritter is one of the Founding General Partners of Emergence Capital. He is a prominent figure in the venture capital industry, particularly known for his role in shaping the SaaS revolution. Gordon has been instrumental in identifying and supporting transformative enterprise software companies that have gone on to achieve massive success.

Career Highlights:

• Salesforce: Early investor and board member, helping guide the company to become a global SaaS leader. Gordon shares more details on the pod.

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Trillion Dollar AI Opportunity

Tomasz Tunguz is a prominent venture capitalist and the Founder & GP of Theory Ventures, a $688M AUM fund. Theory focuses on investing $1-25m in early-stage companies that leverage technology discontinuities into go-to-market advantages. Before Theory, Tomasz was a managing director at Redpoint Ventures, where he led investments into companies such as Looker, Expensify, Monte Carlo, Dune Analytics, and Kustomer. Throughout his career, Tunguz has been recognized for his data-driven approach to investing and his very popular, personal blog, TomTunguz.com (which we reference a lot in the weekly deals newsletter).

Tomasz recently raised $450 million in November of 2024 for Theory Ventures' second fund, which marks a significant milestone for the firm. This follows his initial breakout fund, launched in just 2023, with $238 million. That’s $688M in just 2 years! (We discuss the dynamics of how this works.)

This is a very timely conversation where we go into everything AI, LLM business models (Perplexity), macro outlooks, operating stacks, fund construction, and more.

→ Listen on Spotify, YouTube, Apple

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Timestamps

0:00 - Welcome Tomasz To Sourcery

1:00 - State of AI Adoption

6:45 - Power Struggle Btwn OpenAI xAI & Hyperscalers (*nuclear energy*)

9:50 - AI Inference Will be 1 Billion Times Larger

15:00 - Perplexity's Move into Ad Monetizing

20:00 - Raising $688M in 2 years

28:00 - Theory's Investment Theses: 3 Buckets

33:30 - Partnering with Former Palantir Executive & Building the Team

35:45 - Tomasz's Journey to VC

37:40 - What Is Tomasz Looking Forward To The Most This Year

The Macro of It All

The early-stage investing market is in a dramatic transformative moment, driven by the rapid adoption and evolution of Artificial Intelligence (AI) and the incoming new application wave of Web3 and Blockchain technologies (too early to thank to the AI & crypto czar?).

Consumer AI adoption is on the rise, particularly among younger demographics, signaling a shift in market dynamics. However, enterprise AI adoption faces unique challenges due to the narrower range of acceptable outcomes. As AI infrastructure becomes more prevalent, energy consumption has emerged as a critical factor to consider. Interestingly, the cost of AI inference is decreasing, which is unlocking more demand but energy expenditure is creating significant roadblocks for model development and scale.

And so, how do independent LLMs compete to monetize in a world dominated by hyperscalers and OpenAI? The advertising model, a cornerstone of the largest revenue streams in the world, is trying to find its footing with the likes of Perplexity and more. This will be a fun one to watch. In addition, behind the scenes, the actual advertising business is being disrupted by generative AI technologies, which makes things a bit dramatic.

As for web3 & blockchain?

“Very very few people appreciate like the scale of Ethereum. Ethereum in the first quarter of 2024 produced on a percentage basis, the most profitable software company in the world, and on a aggregate dollars basis sixth largest producer of cash it's worth seven Snowflakes put together, it's $350 billion market cap. $250 billion worth of memecoins that have been created out of thin air. There's just a lot of market cap.

→ Fund Construction, Thesis, Resources, 2025 Predictions Below

It’s 2025 and AI is expected to significantly alter workflows across various sectors leading many to wonder what our jobs will look like “post-AGI.” The impending advent of Artificial General Intelligence (AGI) could lead to super duper productivity gains, but it necessitates a shift in work practices that are unclear and scary to most. In this landscape, Theory’s ‘raison d'être’ with a data-driven DNA gives them an edge above others, by testing, researching, applying, and analyzing, trends, insights, products, and all of the mysterious signals to come.

Highly recommend following Tomasz for his early alpha.

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Building Mental Resilience

Joe De Sena is an entrepreneur, endurance athlete, and the founder of Spartan Race, a globally recognized series of obstacle course races. He is also absolutely no BS, tells it to you straight, & is incredibly enjoyable to listen to. This was a very fun conversation. And yes, I was a little bit scared.

Spartan Race has become a global phenomenon, with events in 45 countries, over 11 million people crossing the finish line, 1,100 races this year, a cult following so loyal that more than hundreds of thousands have the Spartan logo tattooed—some even on their faces..

“I get paid in people telling me that their lives changed.”

We explore a wide range of topics, beginning with the importance of mental resilience and how he's developed a "resilience flywheel" to help people strengthen their minds and bodies. He delves into the powerful cult following of Spartan Race, even touching on how technology like AI could play a role in the brand’s evolution.

Joe also shares his thoughts on the tension between chasing money versus purpose, using examples such as Purdue Pharma and Red Dye No. 3. He provides insights into mergers and acquisitions, scaling Spartan Race, and advice on navigating competitive industries. The discussion transitions to investing in the fitness industry and wraps up with practical tips for training for Spartan Race along with what excites Joe most about the future heading into 2025.

Joe also told me to carry around a 30lb rock this year, so if you see me with a large rock, don’t be surprised & don’t afraid to say hi.. to both of us.

→ Listen on Spotify, YouTube, Apple

Timestamps:

0:30 - Mental Resilience

3:30 - Creating A Resilience Flywheel

8:15 - Building a Cult Following

12:15 - AI x Spartan Race

16:30 - Chasing Money (Purdue Pharma, Red Dye No. 3) vs. Purpose

18:30 - M&A: Acquiring Competition, Scaling, & Advice

21:00 - Investing In The Fitness Industry

31:40 - Training For Spartan Race

33:25 - What Joe Is Most Excited About For 2025

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Resources

• YouTube: The Hard Way w/ Joe De Sena

• Spartan Podcasts

• Joe Rogan Experience #1514 - Joe De Sena (2M+ views)

• Why Spartan CEO Joe De Sena Fled Wall Street and Moved to a Farm

Joe De Sena's Background and Creation of Spartan Race

Joe De Sena grew up in Queens, New York, and developed a strong work ethic early on, working odd jobs and eventually building a successful pool business. In his 20s, he transitioned into Wall Street, where he thrived but found the high-stress environment unfulfilling. A lifelong athlete, Joe became deeply involved in endurance sports, participating in ultra-marathons, adventure races, and triathlons.

This passion for extreme challenges inspired him to create Spartan Race 24 years ago, aiming to bring the transformative power of endurance racing and physical struggle to a broader audience. Spartan Race focuses on building mental and physical resilience through challenging, obstacle-filled courses designed to push participants beyond their comfort zones.

Growth and Expansion of Spartan Race

From its humble beginnings, Spartan Race has grown into a global phenomenon, establishing itself as one of the largest obstacle course racing (OCR) brands in the world.

• Global Reach: As of today, Spartan hosts events in over 45 countries, attracting millions of participants annually.

• Race Formats: Spartan offers a variety of race formats to cater to different fitness levels:

  • Sprint (5K)

  • Super (10K)

  • Beast (Half Marathon)

  • Ultra (50K+)

  • Spartan Kids Races for younger participants.

• World Championships: Spartan holds prestigious events like the Spartan World Championship, which attracts elite athletes from around the globe.

Acquisitions and Other Race Expansions

To further solidify its position in the OCR and endurance sports market, Spartan Race has expanded its portfolio by acquiring or partnering with other notable race brands:

1. Tough Mudder: In 2020, Spartan acquired Tough Mudder, another popular OCR series known for its team-based, muddy challenges. This acquisition brought the two largest OCR brands under one roof.

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Magically Weird, & Very Good at it

I couldn’t be more thrilled to share our latest conversation with Cyan Banister and Lee Jacobs, Founding Partners of Long Journey Ventures. We discuss their unique investment strategy focusing on their ethos of the 'Magically Weird,' how they build a community of independent thinkers, create memorable events, and foster authentic connections among founders. Notable investments include breakout companies like SpaceX, Uber, Anduril, Crusoe, Notion, DeepMind, Loom, Postmates, and more.

"We're looking for misfits, free thinking people." - Cyan

Sticking with the theme, this conversation is not the typical VC chat, we go deep into the rise of spirituality in Silicon Valley, the importance of aligning profit with purpose, and the shift in venture capital sentiment, highlighting the cynicism among founders and investors. The dialogue culminates in reflections on the future of startups and the significance of community and shared values in achieving meaningful success.

→ Listen on Spotify, YouTube, Apple

Timestamps below, along with resources, a breakdown of each topic (non-consensus & right, recipes for memorable events, rise in spirituality, aligning profit with purpose), and the fascinating story behind it all.

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Timestamps

• 0:00 - A Dynamic Duo: Cyan & Lee

• 3:00 - Long Journey's Unique Strategy

• 6:00 - Crafting Memorable Events, Creating A Community

• 18:30 - What Is "Magically Weird" And Who Does It Attract?

• 24:00 - Origins Of The Fund

• 30:30 - Spirituality In Silicon Valley

• 37:30 - Aligning Profit & Purpose: Building For Wealth vs. Meaning

• 42:25 - State Of Startups: Cynicisms In VC

• 50:30 - 2024 Highlights & What Cyan & Lee are excited for in 2025

Angel Investing → Long Journey Ventures

Lee Jacobs and Cyan Banister first met many years ago while investing in the early days through AngelList with Naval Ravikant. Cyan was already an active angel investor, while Lee did the first angel Syndicate and a lot of SPVs - joining Naval full-time in 2015. After Cyan moved to Founders Fund, Lee continued to impress her with his eye for "magically weird" investments—unconventional opportunities with remarkable potential—safe to say, they collaborated a lot.

“some of our best deals at Founders Fund came from Lee”

When Cyan decided to leave Founders Fund, she approached Lee to co-found Long Journey Ventures.. his response was “duh.” Their partnership thrived on their complementary strengths and shared ethos of supporting independent thinkers and unconventional founders.

Together, they built Long Journey Ventures into a values-driven firm that not only invests in transformative companies but also fosters a unique community through immersive and creatively curated events. Their journey is rooted in a shared belief in aligning profit with purpose, supporting founders with bold visions, and creating lasting impact.

Long Journey Ventures have collectively been a part of 30+ unicorns from the earliest days. Writing some of the earliest checks to companies like SpaceX, Uber, Compound (COMP), Postmates, Affirm, Notion, Loom, Rappi, Crusoe Energy, Mindbloom, Flexport, Niantic, IRL, and many more.

Non-Consensus and Right

Long Journey Ventures has a distinctive investment strategy focused on backing "magically weird" founders and ideas, which they define as unconventional, non-consensus, and often misunderstood at the time of investment. These investments are characterized by their uniqueness and initial dismissal by others, such as Uber's early concept of strangers sharing rides, or Crusoe Energy's idea of mining Bitcoin using gas flares in North Dakota. The firm seeks out misfits and free thinkers—founders with big visions and life missions that drive them to create transformative businesses.

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Today we have Lucy Guo, Founder & CEO of Passes. Passes is one of the hottest creator economy businesses today, offering subscription services for creators to monetize and engage their fans. They’ve raised almost $50M in just 2 years.

→ Listen on Spotify, YouTube, Apple

Passes last raised a $40 million Series A fundraise led by BOND alongside Abstract Ventures, Michael Ovitz’s Crossbeam Ventures, high-profile angels such as Emma and Jens Grede, the team behind Kim Kardashian’s SKIMS, celebrities such as Paris Hilton, Jake Paul and Joe Montana. Seed investors in their $9M round included Multicoin Capital, Florida Funders, Anti Fund, Craft Ventures, Menlo Ventures, and 11:11 Media.

This was a special episode because we recorded it live from Lucy's new studio in Los Angeles! In this conversation, we discuss building in the creator economy, signing huge names, building a creator HQ in LA, the biggest misconceptions of the business, raising $50M in 2 yrs, ditching web3, and their competitive fintech & data strategy.

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Timestamps

• 0:00 - Welcome Lucy To Sourcery!

• 2:20 - Future Of Consumer Social

• 6:15 - How To Become The 1% Of Creators

• 9:00 - Lucy's Studio In Los Angeles, The Next Gen Of Agencies

• 12:00 - Lucy's Goal For Passes

• 15:00 - Working With Shaq, Kygo & Olivia Dunne - Any Dream Creators?

• 18:20 - Strategizing Brand Activation

• 21:45 - Regrets From Moving On From Web3?

• 24:00 - Misconceptions Of Passes

• 27:00 - LA Psychics

• 29:00 - Raising $50M In 2 Years - Fundraising Strategy

• 31:00 - Lucy's Long Term Goals

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Bridging the Digital Divide

Today Molly O'Shea speaks with ⁠Dan Wright⁠ (follow on X), CEO of ⁠Armada⁠, backed with $100M to date from notable investors like Trae Stephens from Founders Fund, 137 Ventures, Lux, Dragon Global, Microsoft’s M12, 8VC, Shield Capital, Felicis, Commodity Capital, Contrary, among others.

Trae Stephens and the 137 Ventures team helped Dan found Armada in the early innings, noting Trae’s “Choose Good Quests” was a meaningful influence to go big.

→ Listen on Spotify, YouTube, Apple

Armada is a leading full-stack edge computing company deploying servers for advanced AI applications in remote locations. More impressively, this company barely started two years ago and has been out of stealth for less than a year, while achieving critical milestones like partnerships with Starlink, Skydio, Halliburton, reaching almost 50 countries, and more.

“Around 10% of enterprise-generated data is created and processed outside a traditional centralized data center or cloud. By 2025, Gartner predicts this figure will reach 75%”

Dan is a remarkable figure in the world of data coming from key executive positions at DataRobot and AppDynamics, while Armada’s COO ⁠Jon Runyan⁠ led Okta through its IPO, and CTO ⁠Pradeep Nair⁠ was VP of MSFT Azure. This is a great sneak peek into the early innings of one of the next most important rocket ship companies in technology.

“In terms of milestones, we don't think of them in terms of months or years out. Every day we need a new milestone. We move insanely fast at Armada, which I think is a by product of the quality of the team that we have, but also total clarity about what we're building. Also why we can afford to be really ambitious.” - Dan Wright

Highlights, News, Fundraising Info, & Memo below.

Armada is Hiring!

Highlights:

• (00:00) Introduction & Founding of Armada w/ Trae Stephens & 137 Ventures

• (02:52) Recruiting Top 1% Talent 

• (04:34) Armada's Product Suite: Connect, Edge, and OpsAI 

• (14:20) GTM Strategy & Rapid Global Expansion to ~50 Countries

• (21:01) White Space: Why No One Has Solved This

• (22:42) Key Partnerships & Building a Moat 

• (24:02) Sourcing GPUs & Scaling Production 

• (25:51) Growth Strategies From DataRobot to AppDynamics

• (27:52) $100M in VC Funding: Capital Allocation & Milestones 

• (30:39) Crazy Edge Cases, Team Expansion, and Hiring Priorities

Armada in the News

• NVIDIA Inception Member: Armada | Edge AI and High-Performance Computing in Remote Areas

• Satya Nadella recognizes Armada at Microsoft Ignite, noting how Armada is utilizing Starlink connectivity and their partnership with MSFT Azure to bring cutting-edge AI and local data insights to the most remote and challenging environments worldwide [more slides]

Follow Armada on X

Choosing Good Quests

The idea for Armada started as a friendly conversation between Dan Wright and Trae Stephens, of Anduril and Founders Fund. They discussed Dan’s next big move to change the world after executive roles leading data teams at DataRobot and AppDynamics. Specifically, they focused on a few macro trends:

1. Starlink rapidly bringing connectivity to remote locations around the world (Starlink is now 2/3 of all Satellites in orbit, bringing connectivity to 100 countries with 7,000 satellites)

2. The explosion of IoT with the cost of cameras, sensors, drones, and robots decreasing significantly in the last five years

3. The rise of large language models and advanced AI applications in operations following the wake of ChatGPT

At the time of their conversation, Trae was writing an article titled 'Choose Good Quests'. This article influenced their decision to think bigger, create impact, and pursue Armada as their next venture. Alongside Trae, Armada was founded with strategic input from Christian Garrett, Justin Fishner-Wolson and Alex Jacobson of 137 Ventures. They saw Armada as a 'good quest' worth spending a lot of time on and they believed that if the company succeeded, the world would be a better place for it.

Trae led the first round of capital for Armada’s $55M in financing with Lux, Shield, and 8090 Industries. This marked the beginning of Armada's journey.

Huge Opportunity

The edge computing market is expanding rapidly, driven by the need for real-time data processing in remote locations for legacy industries left in the dark, often with stale data, a critical need to address billions of dollars in commercial decision making, and safety response.

Armada's focus on the "remote edge," which constitutes about 70% of the world, positions it to capture a significant share of this burgeoning market. Gartner predicts that by 2025, 75% of all data will be generated at the edge, underscoring the vast potential for Armada's growth.

Going “Full-Stack” First

Armada provides technology to remote areas where connectivity and cloud infrastructure is limited, and where deep analytics and AI are needed to transform operations at the edge. Armada offers a comprehensive full-stack edge computing platform which integrates three key products: Connect, Edge, and OpsAI.

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Today we have Joshua Browder, Founder & CEO of DoNotPay. DoNotPay is an AI champion built to help fight big corporations, protect your privacy, find hidden money, and beat bureaucracy. Joshua started DoNotPay back in 2015 after dropping out of Stanford to pursue a Thiel Fellowship and has since saved consumers $100M+ on over 1.6M cases.

→ Listen on Spotify, YouTube, Apple

Now DoNotPay is valued over $200M with ~$23M in total funding ..from honestly every big name fund out there, including Andreessen Horowitz, Founders Fund, Coatue, Index, Lux Capital, Tribe Capital, Day One Ventures, DST Global, the Chainsmokers, and more.

We go deeper into the innovative features of DoNotPay, its ‘spicy’ media strategy, and what it means to take risk.

Browder also reflects on his experiences as a Thiel Fellow and his investment philosophy as “statistically” the most active Thiel Fellow investor.

More impressively, unlike some, if not most, SaaS companies, DoNotPay is actually profitable and was one of the first VC-backed companies to issue dividends back to their investors. ..highly unconventional for a startup, if not, a tech stock.

This is a really fun conversation and Joshua shares it all!

Highlights

(07:10) Unexpected Allies: Warren Buffett and IBM Watson

(10:50) Media Strategy: Tapping into Anger and Current Events

(15:39) Enemies and Good Media Strategy

(17:05) Business Model: Subscription, Profitability, and Dividends (!!)

(23:40) Thiel Fellowship: Investing in Young Entrepreneurs

Full Timestamps

(01:03) DoNotPay: Fighting Big Corporations and Bureaucracy

(02:13) A Modern-Day David vs. Goliath

(03:33) AI and DoNotPay: Not Just Agents, But Robots

(04:20) Scale and Impact: DoNotPay's Success Stories

(05:17) Key Use Cases: Free Trial Credit Card and Robo Revenge

(12:40) Supreme Court Challenge: A Million Dollar Offer

(21:40) Investor Relations: Favorable Relationships and Strategies

(29:40) The State of Entrepreneurship: Challenges and Opportunities

(33:00) Leadership: Values and Influences

(35:10) 2025 Predictions: Voice AI, Tech Bubble, and M&A

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Today we have Jason Fiedler, Managing Partner at Left Lane Capital, a $2B+ New York and London-based global venture capital and growth equity firm investing in hyper-growth Consumer and SMB businesses with enduring customer relationships.

→ Listen on Spotify, YouTube, Apple

Known for their heavy sourcing and data-driven strategy spun out of Insight Partners, we discuss Jason’s atypical, yet very lucrative, venture focus on nextgen consumer goods, sports, and a massive opportunity in the retail landscape for “four-wall” businesses in America.

These businesses have high quality revenue and growth metrics that make them irresistible, but also, they’re just really cool. Who wouldn’t want to invest in local coffee shops, pet food businesses, healthier sodas, burger chains, or sports leagues?

“It's been way less crowded on focusing on these massive consumer markets that have billions of dollars of spend, slow incumbents, repeat purchasing.”

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We go deep on

• “Anti-AI” Investment Strategy (yes, I’m being dramatic.)

• Soda’s Cigarette Moment + Olipop’s $1B Valuation?

  • How many bananas are in Olipop!?

• Reaching $2B+ AUM in ~5 years

• Conviction in Sports Investing

• Jason’s Sims City Vision

• Utilizing ‘NPS Delta’ Analysis to Pick Winners

• Insight’s Metrics-Driven Software Approach Applied to Consumer Investing

• “Pearls & Strings” Framework

Left Lane Capital is known for their speed and thoroughness, emphasizing the significance of a rigorous process for sourcing deals, but Jason surprisingly balances this out by also keeping track of 'crazy ideas’ in a pretty normal way.. his Apple notes. This method has lead him to very large investments like Talkiatry, Olipop, Farmer’s Dog, FIGS, Blank Street, Holy, and more.

“Don’t sleep on DTC”

P.S. did I mention he’s bullish on beverage?

Fun Fact: Coca-Cola owns 21 brands and Pepsi owns 22 brands that each bring in over $1 billion in revenue annually. [Grapefrute]

Left Lane Stats:

• 80 Portfolio Companies

• $5-50M Checks

• Targeting Series A Stage

• 12-14 Board Positions per Partner

• 37 Team Members

• Young Team: <35 Years Old

• 600-800 Deals Sourced / Month

• 70% of Deals Sourced From Junior Team

Jason’s Personal Investments:

Data from Pitchbook

• Farmer’s Dog, DTC Fresh Pet Food

  • $150M in Total Funding on a ~$2.5B Valuation

  • On Pace for $800M in Sales, Dec 2023

  • Investors: Insight Partners, Forerunner Ventures, Shasta Ventures, Collaborative Fund, SV Angel

• FIGS, DTC Scrubs

  • $4.4B at IPO (now at ~$1.1B)

Left Lane Investments:

Data from Pitchbook

• Talkiatry, Telehealth Psychiatry

  • $188M+ in Total Funding

• Jackpocket, #1 Lottery App

  • Sold to DraftKings for $750M

• Blank Street, Coffee Shops

  • $105M+ in Total Funding

  • Blank Street reports ‘pivotal growth’ in the UK as outlet expansion outpaces US [World Coffee Portal]

• Holy, Powdered-Based Drinks

  • $11M+ Total Funding

  • Nearing $100M run-rate

• Olipop, New Kind of Soda, High Fiber. Less Sugar. Delicious Flavors

  • $1B Valuation

• King’s League, Soccer League

  • $64M+ Total Funding

  • Gerard Piqué's Kings League secures €60M for next-generation football competition [Tech EU]

• League One Volleyball, Volleyball League

  • $51M+ Total Funding

Timestamps

(00:00) Anti-AI Strategy

(01:50) Inspiration from Starbucks and Investment Strategy

(04:07) Subcategories of Interest

(05:14) Applying Frameworks from Software to Consumer

(06:56) LTV to CAC and LTV to CapEx

(08:43) The Sims City Vision

(10:35) NPS Delta

(11:51) Growth and Current Stats

(15:33) Number of Investments and Board Seats

(16:15) Sourcing Deals and Thematic Approach

(19:18) Identifying Breakout Companies

(20:41) The App Store Influence

(21:29) Risks of Rapid Growth

(23:08) Olipop Investment

(25:24) The Holy Investment and Powder-Based Beverages

(33:39) Staying Balanced with a Hybrid Team

(29:25) Conviction on Sports Investments

(31:51) Crazy Ideas and Future Investment Areas

(34:10) The Next Big Trends

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Fueling Multiplanetary Species, Starting with Lunar Ice Mining

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Today we have Saurav Shroff, Co-Founder of Starpath. Starpath’s mission is to become the leading large-scale commodity supplier for multiplanetary energy, specifically with rocket propellant production on the Moon & Mars.

..AKA becoming the Aramco of the galaxy (starting with the moon).

Starpath recently closed on $10.5M in Seed capital from large names such as 8VC, Fusion Fund, Day One Ventures, Hummingbird, and more, bringing their total funding to ~$12M.

→ Listen on Spotify, YouTube, Apple

In this conversation, Saurav discusses their ambitious mission to efficiently extract lunar ice, which is then processed into liquid oxygen (LOX), a crucial component of rocket propellant. This initiative aims to produce 1,000 tons of LOX annually, significantly boosting the sustainability of lunar operations.

We also get into the technological and logistical challenges involved, including energy demands, regulatory considerations, and the scaling of operations. As well as a pretty shocking business model, ‘competitive’ landscape, and the importance of testing methodologies for ensuring the durability of equipment in harsh lunar conditions.

Maybe, even more ambitiously.. Saurav believed they can fully development this out with no more than $100M in total capital.

Why now?

Capitalizing on the right time and place, recent advancements like reduced launch costs and successful Starship missions officially transitions the idea of establishing a human presence on Mars from science fiction to reality. As the next logical step in the supply chain, Starpath is here to help propel humanity even further with multiplanetary energy.

So the real question here is, would you move to Mars?

Highlights, Key Points, Process for Multiplanetary Development, & Resources below

Starpath is hiring!

Highlights:

(00:00) When will we become multiplanetary?

(04:26) The Aramco of the Galaxy

(9:53) Should the Moon be a State? + Regulatory considerations for lunar mining

(11:34) Energy demand to propel rockets from the Moon to Mars

(14:37) Market opportunity, reduced launch costs, SpaceX’s Starship

(16:36) Prototyping and scaling to 50 mining machines

(17:57) Final design & functionality of systems

(20:10) How much ‘stuff’ do you need to bring to the Moon? Starpath Ratio

(23:42) Working with ‘extremely violent’ regolith

(28:01) Business model and revenue strategy

(30:45) Conviction on creating a Mars fuel company

Key Points:

1. Starpath is building three core systems: power generation (Tower), mining (Rover), and refining (Plant) to produce rocket propellant on the Moon and Mars, with initial operations targeting 300 kilowatts of power to support 1-2 Starship launches per year.

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SO excited to share this conversation!

Today we have Richard Socher, previously Chief Scientist at Salesforce and a leading figure in AI. Richard is Founder & CEO of You.com & co-founder and Managing Director at AIX Ventures. You.com is pioneering knowledge work with an AI-driven productivity engine and recently raised a $50M Series B led by Georgian with participation from Salesforce Ventures, NVIDIA, Gen Digital, SBVA (formerly Softbank Ventures Asia), DuckDuckGo, and Day One Ventures, bringing You.com’s total funding to $99M. 

→ Listen on Spotify, YouTube, Apple

Previously, Richard founded MetaMind, which successfully exited to Salesforce and then served as Chief Scientist at Salesforce. Richard was an adjunct professor at Stanford and earned recognition as one of the top five most cited researchers in natural language processing worldwide. With AIX Ventures has invested in over 30 AI startups like Hugging Face, Weights & Biases, Wispr, and more.

Special Offer

In this conversation we unveil how You.com has evolved from search engine to 'productivity engine,' processing millions of queries daily for millions of customers through a unique combination of accurate search and LLM orchestration.

The company's contrarian bet on accuracy over marketing hype is paying off, attracting hedge funds, biotech firms, and Fortune 500 companies who need trustworthy AI. Unlike competitors who often fake citations, You.com's approach enables users to verify sources down to the exact paragraph—a critical feature when careers and million-dollar decisions hang in the balance.

Richard shares a compelling vision of the future where AI Agents outnumber human web users, and knowledge workers become AI managers rather than task executioners. But he tempers the hype with pragmatic insights about AI's current limitations, arguing that while simple chatbots can help with weather forecasts, the real revolution lies in automating complex knowledge work.

Plus, we can’t help but get into analyzing the AI valuation bubble, a comparison between Meta & OpenAI, and some of Richard’s investment strategies.

With their recent $50M Series B led by Georgian, You.com is scaling this vision of AI-augmented productivity, while pioneering features like multiplayer modes for team collaboration and custom AI agents. 

Highlights

(02:35) Discussion of You.com's $50M Series B funding round

(14:16) Ensuring accuracy and reliability of information

(19:04) Technical infrastructure and search stack

(25:18) Introduction of multiplayer features

(27:37) Evolution of AI agents on the platform

(31:16) Customer profiles and use cases

(34:58) The decreasing marginal cost of intelligence

(38:16) Future of AI automation and workforce

(41:11) Richard's background and career journey

(46:00) Perspective on AI agents as an Investor and Founder

(49:01) AI investment landscape and opportunities

(51:31) Current AI funding market dynamics

(52:57) AIX Ventures investment strategy

Resources

• You.com raises $50M Series B [You.com]

• You.com raises $50 million to make knowledge workers more productive [You.com]

• You.com is your AI-powered productivity engine [Cerebral Valley]

• With $50M in new funding, You.com thinks its AI can beat Google on hard questions [TechCrunch]

• You.com founder talks the future of AI: Opening Bid [Yahoo Finance]

• Amazing Answers: Richard Socher on how You.com is Reimagining Search with AI [Cognitive Revolution]

• Richard Socher On The Future Of Trust In LLMs [Snowflake Developers]

• Richard Socher | You.com | How AI is Changing the World [Scale AI]

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A ‘fan favorite’ for Los Angeles, today we have Jeff Morris Jr (“JMJ”), GP of Chapter One and infamous product leader at Tinder.

We discuss the existential crisis emerging managers are currently facing and the stark realities of an industry in flux. From the looming specter of industry consolidation & shutdowns, to the relentless pressure to prove relevance.

Offering a candid look at the struggles and strategies of today's fund managers, Jeff describes ecosystem where only the most adaptable will survive. He talks about the delicate balance between chasing deals and building a sustainable franchise, all while navigating a landscape where past unicorn valuations holds diminishing returns.

We also touch on the solo GP experience, Chapter One’s active product-driven strategy, and the significance of location in building a venture career (AKA why LA is the best city ever).

→ Listen on Spotify, YouTube, Apple

Background

As an operator, Jeff was one of the best known product leaders in the industry & previously served as the VP of Product, Revenue and an early employee at Tinder.

In the role, he led the revenue team to the #1 top grossing app in the App Store — and managed the business from the early days of monetization through the IPO, and for several years as a public company.

Jeff began investing in 2016 as an angel and a scout for Index Ventures. He is a seed investor in 13 unicorns including Mercury, Supabase, Compound Finance, Ro, Lyft, and Misfits Market. As well as other notable companies such as Glue, Farcaster, Captions, and Density.

Chapter One is an early-stage venture fund focused on helping seed stage companies find product-market fit. Their team has particularly strong technical chops as they previously held roles as product leaders at Twitter, Tinder, Robinhood, and Scale AI. Their LPs include many top venture funds (Sequoia, Greylock, Bessemer, Index, Kleiner Perkins) along with institutions.

Chapter One has ~$130M AUM and is currently investing from Fund II and will activate Fund III in Q1 2025.

Highlights

• (02:02) The Tweet: Emerging Fund Consolidation

• (02:34) Venture Capital Shakeup: Uncertainty and Options

• (05:14) Conversations with Beezer: Institutional Backing

• (07:09) Defining an Emerging Manager

• (08:32) Current Conditions for Emerging Managers

• (12:47) Consolidation: Examples and Creative Options

• (20:50) # of VC Investors Cut by ~50% !!

• (31:02) Staying Relevant: Attracting Talent and Founders

• (35:06) The Solo GP Life: A Reality Check

• (42:20) Chapter One's Product-Driven Strategic Advantage

• (50:46) LA vs. The Bay: A Perspective on The Better City

Emerging Fund Consolidation

The venture capital emerging manager market is currently facing significant challenges, with the fundraising environment described as one of the most difficult in recent memory. Emerging managers are struggling to secure financing due to a cautious investor climate that favors large established managers.

Of the 10,000 funds Pitchbook is tracking in market, 45% of them are emerging fund managers. With only 16% of the total capital allocated to venture capital, emerging managers are left competing for an even smaller share.

Read more

Back by popular demand, today we have Alex Kolicich, Founding Partner at 8VC. Alex is a serious industry leader to follow with his quarterly reports on the state of the VC market, standing out with his sharp insights from a both macro lens and a strategic vertical breakdown.

In Alex’s first appearance on Sourcery in Q1 2024 we discussed the Exodus of Venture Capital & AI Predictions, where he predicted a significant contraction of the VC industry after a handful of notable funds started to shut down.

As a reminder, Alex invests in IT and Bio-IT, and prior to joining 8VC, Alex was a Partner at Formation 8, and worked with Peter Thiel at Mithril Capital Management, a growth-stage venture fund. Before venture, Alex was as engineer and early-product advisor at Clarium, Palantir, and Google.

→ Listen on Spotify, YouTube, Apple

In today’s conversation we dive deeper into Alex’s latest H1 2024 report discussing the current state of the venture capital landscape, particularly focusing on the uncertainty surrounding AI investments and the undervaluation of software companies. Highlighting the potential for incumbent ISVs to capture AI value through integration into existing workflows. While also addressing the clear “AI capabilities gap” and the current ‘oversupply’ of GPUs, suggesting a near-term peak in demand.

Additionally, Alex explores the renaissance in defense technology, driven by successful startups like Palantir, Anduril, SpaceX, Saronic, Epirus (and more!), as well as recent procurement reforms (shared below), positioning it as a viable venture category. Lastly, we touch on the macroeconomic outlook, where Alex indicates short-term inflation abatement but anticipates future pressures, influencing market dynamics.

Read more below on 8VC’s defense investments, 8VC’s Build Program, recent changes enabling the opportunity for defense startups, & some charts shared by Alex

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Highlights

• AI Investment Uncertainty: Despite rapid growth in AI capabilities, there is considerable uncertainty about where investors will profit. All layers of AI, such as application, infrastructure, and services, are priced for high value capture, yet defensibility and gross margins are lacking.

• Software Undervaluation: Cloud software companies are undervalued by the market, as opposed to AI-focused companies like NVIDIA and ASML. Incumbent ISVs integrating AI into workflows could capture significant value.

• AI Capabilities Gap: Current AI architectures are approaching performance limits, with improvements needed in synthetic data use, multi-modal data, and compute scaling. An oversupply of GPUs suggests a possible peak in demand.

• Defense Tech Renaissance: Defense tech is becoming a profitable venture category, with startups like Anduril, Saronic, and Epirus leading innovation. Reforms in defense procurement and contracting are creating opportunities for new entrants.

• Macroeconomic View: Inflation is decreasing, but monetary contraction is expected, posing challenges for markets. Inflationary pressures may return in 2025 due to political spending.

Timestamps

(01:01) AI Optimism & Uncertainty

(06:51) Public & Private Market Dynamics

(12:34) Sustainable Multiples & Oversupply of Capital

(14:33) Risk & Returns of Mega AI Checks

(22:35) Opportunities Within the Gap

(27:18) The Exit Environment & Acquihires

(31:14) The Defense Wave

(40:26) Resources for Defense Startups

(46:42) Startup Advice for Defense

(46:51) Technical Excellence, Government Relations & Fundraising

(49:23) Surprises & Changes in H1 2024

(49:55) Shifting Views on Application Layer & OpenAI

(52:44) Wrap

Leading Defense Funding

8VC is a prominent player in leading the future of defense funding. Notably incubating these companies through their "build program," a strategic initiative designed to incubate and co-found defense technology companies. It provides a robust support system for startups, offering vital resources such as capital, government relations expertise, and shared infrastructure.

Read more

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Today we have Sam D'Amico, founder of Impulse Labs, discussing Impulse’s innovative approach to home electrification through next-generation appliances, starting with a powerful battery-integrated stove.

Impulse Labs has raised $25M in total funding to date, with their last round, a $20M Series A, led by Josh Wolfe of Lux Capital in 2022. Sam discusses the vision behind Impulse Labs, the importance of energy efficiency in homes, and how their products can revolutionize cooking while contributing to a decentralized energy future.

→ Listen on Spotify, YouTube, Apple

The conversation touches on Sam's background in consumer electronics from working on Google Glasses to Oculus, the current landscape of home energy usage, and the potential for resilience in energy consumption through battery technology.

We go deeper into the evolution of battery technology, particularly the advancements made by the U.S., Tesla, and Chinese manufacturers, with lithium iron phosphate batteries. As well as the ongoing shifts in global battery manufacturing and the potential for increased U.S. production.

Learn how Impulse Labs aims to be a "Trojan horse" for decentralized battery-powered homes, potentially revolutionizing home energy management and grid stability, all the while, delivering a premium performance cooktop fit for Michelin-star chefs and pancake fanatics.

Special thank you to Minn Kim of Lighthouse for the introduction, and Anna-Sofia Lesiv of Contrary Research for help with research on batteries & the grid (linked below).

Highlights

• (02:22) Early Influences: Oculus & Google Glass

• (15:13) The Advantage of Battery Integration: Faster Cooking & Efficiency

• (27:47) The Science of Pancakes: Temperature Control & UI/UX

• (31:08) The 20-Year Vision: Decentralized Energy & Home Self-Sufficiency

• (34:57) Decentralized Grid & Emergency Power Solutions

• (41:12) The Battery Revolution: Technological Advancements & China's Influence

• (48:03) Lithium Mining & the Future of Battery Manufacturing

$25M in Total Funding

• $20M Series A funding led by Lux Capital, and joined by Fifth Wall, Lachy Groom and Construct Capital

• $5M seed round in 2021 led by Lux Capital, Construct and Lachy Groom

Product

Specs

• Dimensions: 30” cooktop.

• Performance: up to 10 kW with exact temperature control starting at room temperature (approx. 5x more powerful than gas and 3x normal induction).

• Pan compatibility: works with induction-compatible pans.

• Power requirements: 120V / 15A (NEMA 5-15P plug) or 240V circuit.

• Battery: 3 kWh Lithium Iron Phosphate.

• Inverter: grid-tied, up to 2.2 kW, 220-250V 50-60 Hz AC.

• Depth: fits in standard drop-in countertops (compatible with typical drawer clearances).

Reserve

Resources

Interviews

• Sam D'Amico: Secretly Electrifying the Grid with Stoves [S3]

  • World's Most Powerful Stove: Boils Water in Seconds | Impulse [S3]

• Sam D’Amico | Impulse Labs [Wharton Launch Pod]

Foundations & Frontiers

• The Challenge of Building Better Batteries - A deep dive into the science of battery power. [Anna-Sofia Lesiv]

• Modernizing the Electric Grid - A deep dive into what it will take to modernize America's grid. [Anna-Sofia Lesiv]

• How Much Energy Will It Take To Power AI? - Napkin math estimates on AI energy usage. [Anna-Sofia Lesiv]

• The New Era of Mining - The efforts bringing mining into the 21st century. [Anna-Sofia Lesiv]

• The Past and Future of Metallurgy [Anna-Sofia Lesiv]

More

• Base Power Company - Building the Modern Power Company of the Electric Era [Not Boring]

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Timestamps

(00:00) Intro

(01:04) Sam's Journey: From Pizza Ovens to Battery-Powered Homes

(02:22) Early Influences: Oculus & Google Glass

(08:14) Funding & the Landscape of Home Energy Usage

(10:20) Energy Usage Trends & Appliance Distribution

(12:08) Innovation in the Stove: Power, Precision, and Efficiency

(15:13) The Advantage of Battery Integration: Faster Cooking & Efficiency

(20:18) Integrating Battery-Powered Stoves into Homes

(22:54) Pricing & Market Positioning: Premium Performance & Incentives

(27:47) The Science of Pancakes: Temperature Control & UI/UX

(31:08) The 20-Year Vision: Decentralized Energy & Home Self-Sufficiency

(34:57) Decentralized Grid & Emergency Power Solutions

(38:39) Marketing & Distribution: Targeting Various Markets

(41:12) The Battery Revolution: Technological Advancements & China's Influence

(48:03) Lithium Mining & the Future of Battery Manufacturing

(52:57) A New Economy & the Everyday Appliance Revolution

(53:54) The Path Ahead: Shipping the Product & Scaling the Vision

(54:29) Looking Ahead: Exciting Times for Impulse Labs

(55:07) Wrap

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Today we have Molly Alter, Partner at Northzone, a $1.2B fund X with around $4B AUM. Molly joined Northzone in 2023, bringing with her an impressive track record of 12 investments from her time at Insight Partners and Index Ventures. Her portfolio includes notable successes such as Lightricks, Glia, Tractable, and Frame.io, which she sourced and served on the board of before their $1.28B sale to Adobe.

We discuss her successful investments, founder qualities, VC biases and decision-making, as well as the firm's global approach to identifying opportunities.

→ Listen on Spotify, YouTube, Apple

We dig further into the EU vs USA debate, realistic venture outcomes, and her personal perspectives on the different regions. Alter believes in the potential of Europe's tech ecosystem, citing higher net IRR for European VC funds compared to North American ones over 10-15 year horizons.

Focusing on meritocracy and founder-friendliness with a balanced approach between US and European investments, Alter also explains why she's bullish on workflow SaaS and vertical AI. Despite changing market conditions and valuation multiples (5-6x down from 2021’s 20x), she goes deep into the specific emerging opportunities in vertical AI and software for hardware.

Full Q&A, resources, timestamps & more below

→ Follow Molly Alter on X

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The Debate: EU vs USA

Europe has better VC returns than the U.S., but productivity in the U.S. far exceeds the region

We go deeper on this in the episode, including a pushback on the innovation ceiling in the eurozone due to it’s geopolitical risks, energy dependence, regulations, and conservative outlook on tech.

“European VC yielded 20.77% net IRR (internal rate of return) over 10 years, compared to North American VC’s 18.18%. Over a 15 year period too, European VC has better returns: 16.57% IRR to North American VC’s 16.09% IRR.”

Productivity in US vs Europe

Source: Financial Times

Resources

• Overall Stats: Venture Pulse Q2 2024 [KPMG Private Equities]

• PitchBook's Q1 2024 European VC Valuations Report - Valuations, trends, and outlook [Tech EU]

• European VCs outperform US VCs over 10 and 15 year horizons [Sifted]

• Can This Country Show Europe How to Compete Again? [NYT]

  • Sweden outperforms in tech, has a roster of $1 billion-plus start-ups and could be a model as the European Union refigures its growth policies.

• Perspectives: From Pixels to Prototype – Software for Hardware [Northzone]

Leave a comment

Timestamps

(00:00) The EU vs USA Debate

(03:07) Molly Alter’s Career Journey

(07:26) Insights from Working in Different VC Firms (Insight, Index, Northzone)

(11:38) Investment Focus and Thesis

(15:28) Impactful Investments: Frame.io and Glia

(18:54) Qualities of World-Class CEOs and Founders

(22:17) Northzone: History, Strategy, and Values

(26:06) Global Reach and US-Europe Investment Split

(29:13) Defending European Tech Ecosystem

(32:27) Innovation from Restrictions in Europe

(35:35) Software for Hardware: Opportunities and Challenges

(42:08) Specific Areas of Interest in Software for Hardware

(45:05) The Future of SaaS and Hybrid SaaS Models

(47:30) Example of Hybrid SaaS: GovDash

Q&A with Molly Alter

Since then you moved to London for Index and now you’re back in the states at Northzone - such an incredible journey and I’d love to know, what are your 4 or 5 takeaways from the 8 years you’ve been working in venture across various funds?

• No matter what firm you’re at, your network stays mostly the same, and people have good memories, so every interaction matters – evidenced in this conversation!

• Cliche but the people at a firm are the most important thing - everything else, fund size, brand, should be necessary but sufficient conditions.

• Especially for younger VCs, build your own moat. Nobody wants to look at the boring and complex stuff? Perfect opportunity for you

• Volume matters - your ability to pick is directly correlated to the size of your aperture. Meeting 5 vs 10 companies per week. Same with hiring. 

• Know your biases. Some I think about… 

Do you still travel back to London for work? Any surprises from your time living there? Any recommendations?

• Surprises: the delta between the queuing “hello love” daytime persona and the pub belligerent nighttime persona. Never have I seen such a werewolf-like transition from day to night 

• Recommendations: Gelato: Romeo and Giulieta, Bilmonte. Caesar Salads: I had a great one at the Colony the other day. They let you decide how many anchovies.  

Give your experience at megafunds, I’d love to get your perspective on the difference between large institutions with teams of 30-50-100+ people versus smaller shops - do you get more resources? Do you have to write more reports? More bureaucratic buy-in from partners?

• So there are a number of dimensions in which firms can differ in their approach: Sourcing, diligence, picking, supporting, back office. What I’ve learned so far is that the size often doesn’t correlate with what you’d expect it to. Firms decide what they want to spend their headcount on and that’s typically one of the most strategic decisions one can make. So there are huge firms but the headcount is very focused on sourcing and all the DD or legal work is outsourced. Or there are small firms with few associates but a lot of data scientists to surface deals using technology. To really understand how a firm works it’s important to not just understand the overall size, but actually the composition of their team and how that is distributed across those dimensions. I love sourcing and diligence and so would hate to be at a firm that outsourced the DD process to Bain. But knowing this stuff going in is important. 

For those who may not know, what are you investing in now? What’s your thesis and stage of check?

• Mostly Vertical AI, anywhere from $2.5m to $50-60m. 

What have been your most impactful investments to date? 

• Frame.io - the world's leading video review and collaboration platform

  • Adobe buying Frame.io in $1.28B deal [TechCrunch]

  • Frame.io CEO on Selling to Adobe for $1.3B, Working with SNL and High Pain Tolerance [Logan Bartlett]

• Glia - unified interaction platform transforms how financial institutions connect with their customers using Messaging, Video, Voice, CoBrowsing, and AI

  • Glia raises $45M at a $1B+ valuation for an AI-based CRM that lets agents get hands-on to help [TechCrunch]

Europe’s Landscape

Shifting to Northzone’s strategy, the fund was founded in 1996 in Europe and has strong connectivity to the region, could you share more on the strategic advantage, how the fund was founded, and it’s AUM?

• Founded on the shores of Norway. Entrepreneurs themselves–looked for founders they would have wanted to work with. Pioneered idea of being founder friendly in Europe long before that became a thing. 

• Of considerable note, the shores of Norway were not exactly abounding in tech opportunity in 1996. We went global from the start and this is a huge strategic advantage. Fast forward to today, and we’re a $4B AUM firm with offices throughout the US, Western, and Northern Europe. 

• Scandinavian culture is extremely meritocratic. This helps us avoid hype cycles throughout the decades and focus on technologies and business models with real substance. It also helps us almost completely avoid internal politics, which is really special. Even though investing cycles can take a long time to show up, there are actually really clear numbers on a page that we are accountable to our LPs for. VC firms should’t really be political–I’d understand it more if you were putting on a broadway show and politics ran high because someone’s performance on stage might actually be hard to measure. But investing firms should be able to put aside egos and focus on deliverables and clear metrics like DPI. That’s what Northzone does really well.  

Okay, this is a challenger question, and we’ll switch to the side of VC/macro land that likes to poke at the decline of Europe but I’d like to be aware of the macros against the separate niche that is VC, as well as how they may affect tech innovation.

To first lay it all out, could you share more on the trends of VC dollars, funds, companies, unicorns & success stories that have come out of the region? (i.e. # of unicorns in US vs EU, # of venture dollars, # of venture firms, country w the biggest growth)

Funding

• VC funding reached $29.3 billion in the first half of 2024, a 12% increase compared to the same period in 2023.

• Q2 2024 saw VC investment rise to $17.8 billion, up from $13.9 billion in Q1 2024.

If the current pace continues, 2024 could become the third most active year ever for VC funding in Europe

Regions

• ​​The UK has raised $9.4 billion in total, with $6.8 billion going to London-based firms. France ranks second with $4.3 billion, with Paris emerging as an AI hub

Deals

• As of Q1 2024, Europe had 139 active unicorns, with four new additions during the quarter. Notable mega-deals include Wayve's $1.1 billion Series C round and Mistral AI's $640 million Series B round

Talent

• Flywheel of talent and company builders coming out of multiple geographies, for example, Spotify and Klarna alone has spawned 70 venture backed companies in Stockholm

Now when you compare to the US, of course the US numbers might look more aggressive. But ultimately we’re in the business of making money for our LPs, which doesn’t always mean investing in the markets with the greatest number of deals or highest valuations. When you look at the kinds of companies being built in Europe–capital efficient, better entry prices, often less competition, diverse market opportunities, it’s no surprise that over 10-year and 15-year horizons, European VC funds have yielded higher net IRR compared to North American VC funds.

• European VC achieved a 20.77% net IRR over 10 years, surpassing North American VC's 18.18%

Is there real concern for degrowth/decline in Europe for technology innovation due to their strict regulations & restrictions? Free speech? Access to the internet? Energy dependence & power?

Read more

Today we have Rohit Bhadange, Founder of Zamp, one of the fastest growing sales tax startups in the US. 

Reaching 6x revenue, mid-7 figures ARR, over 400 customers, thousands of completed filings, and $14M in total funding.. all within 15 months of founding the company.

→ Listen on Spotify, YouTube, Apple

The company was founded off of an issue one of Rohit’s portfolio companies was facing, one he thought was so laughably obvious it was hard to believe. Turns out, CEOs, CFOs, and founders in their network from pre-seed to multi-billion dollar businesses all faced the same problem and agreed it was no small task. He was humbled, and then set out to solve for it.

Now, Zamp is able to fully process sales tax compliance for any customer across e-commerce and SaaS with integrations across Shopify, Stripe, Amazon, QuickBooks, Big Commerce, etc. all within the last 1.5 years. Growing super fast, Zamp is all about speed. Speed and accuracy.

Shout out & thank you to Ed Lando of Pareto for the introduction!

Learn more about Z-Tax

Market Comps, Funding to Date, Demo, Timestamps, & More Below

This was a conversation I really enjoyed, we cover a handful of fun topics. Rohit is incredible, thoughtful, and has some juicy takes. Also admittedly, I was naively surprised by how expansive this product is. Every business selling into the US needs sales tax help. Bullish on Zamp & their team.

→ Follow Rohit on X & Linkedin for some great content (he literally goes viral every week)

Some highlights:

• Series A Announcement

• Growth Metrics & Milestones

• Acquiring Zamp.com

• Why Some CEOs Need to Work Harder

• Startup vs. Wall Street Work Culture

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Business Overview

Zamp’s unique approach combines technology & automation with the tailored guidance & support customers are looking for. They set up, configure and monitor your account, which gives you the confidence you are always sales tax compliant. With their developer-friendly API and pre-built integrations, they enable businesses to calculate and aggregate their sales tax across multiple sales channels.

Zamp offers a simple pricing model that includes one all-inclusive price for everything - onboarding, support, calculations, registrations and filing. And there are no overage fees!

Market Comps

• TaxJar Acquired for ~$1B by Stripe

• Avalara to be Acquired by Vista Equity Partners for $8.4 Billion

Funding to Date

Zamp has raised $14M in the last 15 months from some heavyweight silicon valley names

Incubated at Pareto

Pareto builds and invests in early-stage companies. They’re the world’s leading angel investor with over 1K early-stage investments across all industries and around the globe. Pareto are founding investors in / Co-Founders of Misfits Market, Link Money, Catalina Crunch, Goody, Zamp, Palazzo, and others unannounced.

$10M Series A led by Valor Equity Partners

$10M Series A led by Valor Equity Partners with Day One Ventures, Friends & Family Capital and 20Growth.

Zamp also welcomes some incredible angels, including Prasanna Sankar (Co-founder, Rippling), Michael Stoppelman (former SVPE, Yelp), Zachary Bookman (CEO, OpenGov), Adrian Fenty (former Mayor of DC & a16z advisor), Yahya Mokhtarzada (Co-Founder, Truebill), Venus Williams among others.

Read more in their TechCrunch article

$4M Seed Round

Backed by Valor Equity Partners, Soma Capital, Day One Ventures, and angel investors, among others

→ Here's the 12-page pitch deck a startup helping online sellers navigate the complicated world of sales tax compliance used to raise a $4 million seed round [Business Insider]

Demo

Latest demo of the product - check it out!

Extra Resources

• South Dakota v Wayfair

Timestamps

(00:00) Introduction and Series A Announcement

(02:28) Fundraising Process and Investors

(05:34) ZAMP's Origin Story

(13:57) Transitioning to CEO Role

(16:25) Sales Tax Problem and Market Size

(20:44) Go-to-Market Strategy

(25:15) Product Onboarding and Customer Experience

(27:28) Team Composition

(29:22) Growth Metrics and Milestones

(31:32) Business Model and Pricing

(33:32) Acquiring the ZAMP.com Domain

(35:07) Future Plans and New Product Launch

(37:15) Accounting Industry Trends

(39:10) Work Ethic and Founder Responsibilities

(43:14) Startup vs. Wall Street Work Culture

(45:06) Tennis Challenge with Ed

(45:45) Wrap

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Evolution of Infrastructure: On-Prem → Cloud → Edge

AI’s Rapid Ascent & The Critical Roadblocks Companies Face as They Scale

Today we have Astasia Myers, GP at Felicis, to discuss their AI investment strategy and recent $825M fund, totaling Felicis’s AUM to $3B. Astasia goes deep on her focus on databases, dev tools, infra & AI from inception to Series A, with investments such as LaunchDarkly, Hex, and Supabase.

Listen → Spotify, Apple, YouTube

Astasia shares the evolution of enterprise software, shifting from on-premise solutions to cloud service providers to the edge (Armada), democratizing access to infrastructure services. As well as many of the infrastructure opportunities and challenges emerging in AI’s rapid ascent of the tech industry.

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We dive deeper into:

• Technical unlock of foundation models, leading to the emergence of alternative models and AI agents

• Critical AI Roadblocks: Talent, pricing, and packaging strategies

• Felicis’s AI Investment Strategy in 3 Buckets

  • AI infrastructure

  • AI-enabled SaaS

  • AI-enabled services

• Astasia’s Background + Felicis’s Founding Story

• Bullish on Edge Computing

• Emerging Trends in AI: AI agents & autopilots, consumer applications, & more

• How AI is different today vs 2023

Resources

• AI is here to eat your seats, How to survive the revenue shift [Astasia Myers, Ryan Isono, Mischa Vaughn]

• The rise of AI data infrastructure [Astasia Myers, Eric Flaningam]

• Datology: Data curation is the missing piece of the AI strategy [Viviana Faga, Astasia Myers, Tobi Coker]

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Timestamps:

(00:00) Introduction and Founding Story of Felicis Ventures

(06:39) Astasia Myers' Background and Journey to Venture Capital

(11:45) The Evolving Landscape of AI and Infrastructure

(14:59) Sponsor: Archer

(19:27) AI-Enabled SaaS and AI-Enabled Services

(27:16) Technical Unlock: Foundation Models and AI Agents

(33:30) Changing Perspectives and Emerging Trends in AI

(37:47) Research and Identifying White Spaces of Opportunity

(47:05) The Effects of Technical Unlock and Future of AI

(50:36) Wrap

Back to work → Refresher on tech markets & where capital is flowing

State of Tech in 10 Charts Below

Today we have Gené Teare, Crunchbase News' senior data editor. Gené conducts strategic research to explore and report on trends within private company data and focuses in particular on global venture funding trends, artificial intelligence, fintech and gender equity in venture and tech.

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Gené Teare provides a comprehensive overview of the current venture capital landscape, highlighting the ongoing two-year slowdown in the VC market, rise in late stage secondaries (Revolut), and points out a trend towards concentration in late-stage funding.

Gené touched on the growing concern about liquidity in the VC industry due to lack of exits, and the potential of AI as a catalyst for innovation , drawing parallels to the mobile wave that emerged after the 2008 financial crisis. She also covers on the topic of diversity, reporting that female-founded companies received only 3% of total funding in 2023, despite representing 8% of deals.

Learn how AI funding is surging amidst a broader VC slowdown (Clio, xAI, Harvey, CoreWeave, Scale), why late-stage investments are concentrating, and what's happening with M&A and IPOs. Discover insights on unicorn trends, female founder funding, and the potential impact of AI on the tech industry's future.

FWIW

“Recent data from secondary data tracking platform Caplight records more than $706 million being invested into direct secondaries deals — or transactions involving a company stake — in the first half of 2024. That puts this year on track to surpass last year’s $1.1 billion trading volume total. “ NEA quietly reenters the secondaries market

New Secondary Funds

• $468M NEA Secondary Opportunity Fund

• $1.1B G Squared (majority towards secondaries)

• $1.45B Industry Ventures

• $3.3B StepStone (Recently closed: Largest-ever VC secondaries fund)

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Timestamps

(00:00) Introduction and State of Technology in 2024

(02:05) Venture Slowdown and Funding Fluctuations

(06:04) The Rise of AI Funding

(09:15) Challenges in the M&A Markets

(13:48) Sponsor: Archer

(24:26) Power Laws in VC: Concentration of Capital

(34:55) Representation of Female Founders in the Industry

(39:38) The Future of IPO Markets

Quick Resources (more below)

• Unicorn tracker

• July's new unicorns

• Secondaries sees record first half as volume surpasses $70B - Evercore

• The 12 biggest take-private PE acquisitions so far this year in tech

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State of Tech in 10 Charts

US vs Global Funding, AI Increase, Shutdowns Accelerate, Most Active Global Investors, Unicorn Board, Female Funding Trends

Global Funding

Shutdowns Accelerating

Carta

Most Active Global Investors

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I’m so excited to share this conversation with our brilliant, longtime friend, Grace Isford, Partner at Lux Capital, & 2024 Forbes 30U30 in VC.

Grace joined Lux in 2022, and shortly after was named the youngest partner in the firm's history. Grace invests in companies innovating at the nexus of the computational sciences. Since joining, she has sourced and led 8 of the firm's investments including generative AI video standout Runway (valued at $1.5B), Sakana.ai, Maven AGI and LangChain. Before Lux, Isford was a principal at Canvas Ventures, where she sourced $100 million in deployed capital and worked with 10 portfolio companies. 

We go deep on her thesis on computational sciences, the current AI Landscape, her investment thesis on New York City's AI sector, and implementing AI in companies. Grace discusses the potential and challenges of AI agents, the current state of the technology as well as the companies making progress in this space. She also provides practical advice on how companies can implement AI, emphasizing the importance of defining your goals, finding the right tools, and proving value.

Is it time to invest in AI? You might be surprised. Listen to Grace’s insights and perspectives on the current investment climate and where opportunities lie in the evolving AI landscape, highlighting the potential and challenges of infrastructure and application companies.

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We get into:

• Runway’s $1.5B Valuation

• How HuggingFace Makes Money?

• Lux’s Technical Diligence Process

• Grace’s Sourcing

• NYC AI > SF

• Viral Market Map Strategies

→ Resources, 11 of Lux’s Big AI Hits, NYC AI Map, AI Research & More Below

Lux Capital

Co-Founded by Peter Hébert & Josh Wolfe over 20 years ago, Lux is based in NYC, with an presence in SF. They’ve raised ~$1.2B for their most recent fund, amassing over $5B AUM to date, with 200+ portfolio companies, and more than 30 full-time professionals. Their team has a wide spectrum of technical backgrounds with the versatility to invest at any stage, from $100,000 to $100 million.

Lux focuses on Biology + Biochemistry, Chemistry + Material Science, Engineering + Electronics, Infrastructure + Computer Science, as well as Physics + Aerospace. Known for high profile investments into Anduril, Hadrian, Applied Intuition, Benchling, Ramp, Eikon Therapeutics, and more.

NYC AI

In April 2024, Grace launched the infamous callout for NYC AI talent with the NYC AI Directory & AI Map. Based on the numbers, talent migration, and companies taking advantage of this growth & technological opportunity, NYC is officially on the AI map. You don’t need to move to SF to get skin in the game.

• The Great Talent Dividend & NYC’s AI Opportunity [Lux Capital]

  • NYC x AI Company Database

11 of Lux’s Big AI Hits

1. Runway: Specializes in AI-powered video editing tools and generative AI for video content creation. It recently raised $141 million in funding, bringing its valuation to $1.5 billion as of June 2023​ - in July Runway was reported to be raising $450 million in new funding on a $4 billion valuation [SiliconANGLE, Reuters].

2. LangChain: Develops an open-source framework for building large language model applications. It raised $25 million in a Series A round in February 2024, bringing its total funding to $35 million​ [Tracxn, VentureBeat].

3. Sakana AI: Nature-inspired AI models, particularly for autonomous scientific research. As of June 2024, it raised $100 million in a Series A round, reaching a $1 billion valuation​ [PitchBook, Nikkei Asia].

   • OpenAI’s Japanese Rival Gets $1 Billion Valuation From Silicon Valley Investors

4. Together AI: Cloud-based platform that specializes in developing and deploying open-source generative AI models. It recently raised $106 million in a funding round led by Salesforce Ventures, pushing its valuation to $1.25 billion​ [Tech Startups, SiliconANGLE].

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We’re excited to share our interview & deep dive with Kian Sadeghi, Founder & CEO of Nucleus Genomics, on the launch of Nucleus IQ.

Nucleus is a health platform designed to integrate your DNA into your daily life. Nucleus uses whole-genome sequencing, which reads 1,000x more DNA than other tests. That means they can uncover how your DNA influences lots of things about you, from your risk for heart disease to your IQ. Nucleus has raised more than $18M in venture funding, with their last round led by Alexis Ohanian of SevenSevenSix, with participation from Peter Thiel’s Founders Fund. 

Thank you to Cory Levy, Founder of Z Fellows & Investor in Nucleus for the introduction. 

→ You can catch Nucleus at the Don’t Die Summit in San Francisco on Sept 8, 2024.  

Company Deep Dive, Product Demo, Facts, & Resources Below

BIG thank you to Kian, Halle, Prabarna & the Nucleus team for their support in research & writing of this. Really fascinating work & mission.

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Nucleus Genomics: The Genes Behind Genius w/ CEO Kian Sadeghi

5 Key Takeaways

1. Make your DNA part of your everyday life: It’s possible to understand ourselves better than ever before with our DNA.

2. Revolutionizing preventative healthcare: Nucleus is using a DNA-first approach to transform healthcare from a reactive system to one that is proactive, enabling early detection and prevention of diseases based on genetic insights.

3. Providing affordable, comprehensive genetic testing: Their platform combines more than 70,000 individual genetic tests into one comprehensive whole-genome sequencing -based analysis, offering insights into both common and rare conditions.

4. The missing piece in your health stack: There are tons of ways to quantify your health — tracking biomarkers, hormones, and more — but most people overlook their genetics, which are the foundation of your health. 

5. Restore your right to complete self-discovery. You get access to insights that used to just be for doctors and scientists.

Smart or not: Controversy surrounding IQ prediction

Before we go deep into the business, Nucleus has become a hot topic of discussion after they recently went live on X, talking to Silicon Valley’s who’s who about their launch of Nucleus IQ, a special report on how genetics influences our IQ scores. 

Average IQs for any country can be hard to pinpoint, but estimates suggest that the number hovers around 99 and 100 around 99.6. Japan leads the world, with an average IQ score of 106.5. 

Cognitive development is strongly impacted by environmental factors such as education, socioeconomic status, nutrition, and exposure to chronic stress. What’s more, IQ scores have and continue to play a role in how we perceive our own intelligence, our confidence in our intellect, and impact our education and career choices. 

But what cannot be emphasized enough is this: IQ is not the sole determinant of success or happiness. Emotional intelligence, creativity, perseverance, and social skills are of tantamount importance to what makes a successful, well-balanced life. IQ is one part of a much richer human story, but a meaningful one nonetheless. 

Nucleus IQ: Genetics and the battle for intelligence

Nucleus IQ is a genetic analysis that explores how DNA influences how good you are at using reasoning and logic to solve problems. By combining the impact of over half a million DNA differences that affect how we score on an IQ test, they provide a genetic score that places you in a lower-than-average, average, or above-average category.   

An example graph from Nucleus IQ that shows whether their genetics places them high, average, or low on how they’d score on an IQ test. 

While providing insights into the genetic basis of a specific component of intelligence, Nucleus IQ also emphasizes the significant role played by environmental factors and transparently acknowledges the limitations of genetic predictions. Positioned as more than just an entertainment tool, Nucleus IQ aims to offer a scientific perspective on the genetic aspects of intelligence, while remaining mindful of the ethical implications and the evolving nature of this field.

Critics argue that current genetic models for predicting IQ are still in their infancy and may not be scientifically robust enough to justify their use. Despite these criticisms, Nucleus defends its approach by emphasizing the transparent communication of the limitations and potential of these tests. They position their IQ analysis as an evolving tool, one that can offer insights into the genetic factors that might influence cognitive abilities while acknowledging that genetics is only part of the equation.

“Some ethicists also express a darker anxiety: a worry that companies will be tempted to test the blurry line that separates genetic prediction of disease risk from attempts to divine more complex traits laden with social stigmas. They portray it as a slippery slope that could lead to new modes of discrimination and bias.”

From a Fledgling Genetic Science, A Murky Market for Prediction: The commercial push is raising tension between scientists seeking new genetic links, and entrepreneurs seeking profit. [Undark, 10/27/23]

In our episode we go deeper into this, and also talk through the other genetic IQ tests offered online. As someone who loves using brain training games (particularly the app Impulse) to sharpen my intellect, I certainly want to see if the tools I’m using are helping push my number up! 🤓

Product Demo

Nucleus’ inception

Founded by Kian Sadeghi, Nucleus was born out of a personal tragedy that highlighted the need for accessible and comprehensive genetic testing. 

In 2005, Sadeghi’s 16-year-old cousin died suddenly in her sleep of what was suspected to be long QT syndrome, a rare congenital heart disorder. Sadeghi’s parents told Kian it was “bad genetics.”

“I realized that an accessible health platform that uses genomics and lifestyle data to analyze disease risks could have made a life-changing impact on my family,” Sadeghi says. “That’s what we want to build for everyone. That’s what Nucleus can be.”

Nucleus IQ is just a part of the larger picture of Nucleus. While their IQ analysis is eye-catching, their fundamental goal is to transform the healthcare industry and make people rethink what they need to know to stay healthy and live longer. 

On a broader scale, Nucleus is making advanced genomic insights available to the general public, providing a platform that integrates cutting-edge genomic technology with a user-friendly interface. Their mission is to make DNA part of our everyday life. Nucleus currently provides insights on 20 diseases, including heart health, cancers, mental health, and more. 

The company has raised over $18M in funding from Alexis Ohanian's Seven Seven Six, Founders Fund, Adrian Aoun (CEO, Forward Health), Brent Saunders (Chairman and CEO, Bausch + Lomb), Patrick Hsu (Bioengineering Professor, UC Berkeley) and others. 

The power of 6 billion DNA letters

At the heart of Nucleus' offerings is whole-genome sequencing (WGS), a method that allows for the complete analysis of an individual’s DNA. WGS captures both common and rare genetic variants that could have significant impacts on health. Unlike other DNA tests that focus on specific genetic markers or limited panels, this kind of holistic analysis provides a comprehensive view of an individual’s genetic makeup. 

This capability enables Nucleus to identify risks for a wide range of conditions, from common diseases like coronary artery disease cardiovascular issues and cancer to thousands of rare genetic disorders. For example, identifying a genetic variant linked to an increased risk of heart disease can lead to lifestyle changes or medical monitoring that might prevent a future heart attack. Similarly, understanding one’s genetic risk for certain cancers can prompt earlier and more frequent screenings, potentially catching the disease at a more treatable stage. 

By utilizing WGS, Nucleus is part of a larger shift towards a more proactive and personalized approach to healthcare.

Nucleus ultimate goal is to bring the power of DNA into your every day life. In the same way that we assess our sleep, activity level, blood glucose, metabolic health and more through trackers like Apple Watch, Oūra, Whoop, and Levels, Nucleus wants to bring the foundation to all those metrics — DNA — to our habitual health monitoring.   

“DNA companies have stagnated because they haven’t understood that DNA is a part of a health stack — it’s the lynchpin that gives clarity to all the superficial measurements we engage in,” says Sadeghi. 

Nucleus Premium is the first step towards this larger mission. You can order the Premium DNA kit, swab your cheeks, send the DNA sample to their laboratory (Nucleus only sequences in the U.S. and on U.S. machines) and receive insights on a wide array of common diseases. 

They also plan to release a “Generational Health” product in the coming months, geared towards individuals planning on having children. Nucleus will screen for genetic conditions that could be passed on to one’s offspring. This can include single-gene tests for hereditary conditions like cystic fibrosis or broader panels that assess risk for multiple conditions.

If companies like Nucleus can make the kind of splash in personalized health as they are hoping for, we may see more than just an highly engaging IQ report and health analyses. The future is that of individual health, and the gates seem to be opening to a new frontier. 

You can catch Nucleus at the Don’t Die Summit in San Francisco on Sept 8, 2024.  

Nucleus is Hiring!

Facts

• 23&me looks at <.1% of your DNA, Nucleus tests 1,000x more DNA than 23andMe 

• Nucleus currently provides insights on 20 diseases, including heart health, cancers, mental health, and more.

• Their platform combines more than 70,000 individual genetic tests into one comprehensive WGS-based analysis, offering insights into both common and rare conditions.

• Nucleus sequences your entire genome — all 6 billion letters — so you can mitigate more diseases, make healthier decisions, and live with confidence.

• Their whole-genome DNA test is more than 99.9% accurate. From their research, to sourcing, to manufacturing and testing, they go above and beyond industry standards to bring you safe and accurate results.

• About 90% of people in the U.S. don’t know that they have a DNA variant that can cause a treatable disease. 

• Widespread genetic testing for breast and ovarian cancer would prevent almost 10,000 cases and 2,400 deaths every year.

Resources

Nucleus

• Thread: Predicting IQ from DNA [Kian on X]

• Genetics can predict height, cancer risks, neuropsychiatric diseases and more — but not IQ? [Kian on Substack]

  • Is a genetic analysis for IQ snake oil? Complex, yes. Unscientific? No.

• Humanity’s new frontier is complete genomic knowledge. The barriers are ideological. [Nucleus Genomics]

• Nucleus Genomics wants to make personalized health care a reality [Illumina]

  • A New York–based startup is on a mission to bring the power of whole-genome sequencing to the world

Controversy / Genomics

• From a Fledgling Genetic Science, A Murky Market for Prediction

  • The commercial push is raising tension between scientists seeking new genetic links, and entrepreneurs seeking profit.

• Why You Should Be Careful About 23andMe’s Health Test [NYT]

• Illumina: The Measurement Monopoly [The Century of Biology]

  • How one biotech company changed the arc of genomics

Interviews

• How to Become Relentless as an Entrepreneur with Kian Sadeghi, Nucleus [Alex Lieberman]

• Mega Pod! (ft. Martin Shkreli) Debate Recap, Trump Coin, DNA, The Downfall Of The Squad, Green Cards [Pirate Wires]

IQ & Human Intelligence

• ***Richard Haier: IQ Tests, Human Intelligence, and Group Differences [Lex Fridman]*** (highly recommend)

  • Richard Haier is a psychologist specializing in the science of human intelligence

  • Clip: Are people born smart? [Richard Haier and Lex Fridman]

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Timestamps

[00:00:00] Introduction to Nucleus Genomics and Whole Genome Sequencing

[00:01:44] Recent Product Launch: Nucleus IQ

[00:03:58] Demonstration of Personal Nucleus IQ Report

[00:08:12] Controversy in Providing Genetic Insights to Consumers

[00:11:43] Differentiating Intelligence, IQ Tests, and Genetic Contributions

[00:15:00] Sponsor: Archer

[00:15:59] History of Consumer Genomics and 23andMe

[00:19:48] The Future of Consumer Healthcare and Genomics Integration

[00:23:59] Kian Sadeghi's Personal Story and Founding of Nucleus

[00:27:28] Nucleus' Sequencing Partnerships and Process

[00:29:25] Detailed Breakdown of Nucleus' Product Offerings

[00:31:59] Nucleus' Business Model and Future Integration Plans

[00:34:00] Composition and Expertise of Nucleus Team

[00:35:39] Current and Potential Future Partnerships

[00:36:59] Upcoming Product Launches and Growth Plans

[00:37:37] Closing Remarks and Call for Software Engineers

[00:37:59] Outro

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Today we have Jordan Noone, Executive Chairman at Zoo and Founding GP of Embedded Ventures. For context, Zoo is a research and infrastructure company building the tools to introduce A.I. to all aspects of hardware development. Previously Jordan Co-Founded Relativity Space at age 22, which was most recently valued at $4.2B. 

Jordan dives into:

•  Why Zoo started by building a novel geometry engine

•  How the founding team’s background led to Zoo’s products

•  The impact of generative AI on hardware design

•  Zoo’s expansion from software for hardware design, to software for the full hardware development cycle

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Background on Zoo

Zoo’s mission is to modernize the entire hardware engineering software stack, allowing software-configured hardware design and manufacturing. This involves development ranging from the foundational GPU-level computational geometry algorithm development and implementation, to next-generation GUIs bringing code automation and machine learning to the traditional computer aided design (CAD) process performed by millions of engineers daily, to how those designs turn into the G-code running on the manufacturing equipment creating their designs. 

Based in Inglewood, CA Zoo is building these products using their proprietary geometry engine. This engine serves as a digital bridge between hardware development, code, and machine learning frameworks.

Their geometry engine is the world’s first to be GPU based, cloud implemented, API accessible, and dynamically scalable. No one else has this technology, and most think it’s impossible to build. It is fundamental to develop and scale A.I. solutions for hardware development. 

In English: It's software to help build hardware easier.

More on Founding Team, Funding, Product, Tools, Infrastructure, Docs, Use Cases & viral tweets below..

Founding Team

Jessie Frazelle, CEO

One of the top infrastructure-as-code developers in the world. Previously she was co-founder and Chief Product Officer of Oxide Computer Company. That experience introduced her to the archaic world of hardware design, which led her to ask Jenna for an introduction to Jordan, which led to the original thesis behind Zoo. She was previously at Docker, was one of it’s top contributors to the project, and personally ran over a dozen of their software releases.

Jordan Noone, Executive Chairman

In 2015 at 22 years old, Jordan started Relativity Space, which was most recently valued at $4.2B, and is the space startup with the most complicated tech in the industry. He was Relativity's CTO for the first five years, Jordan focused on technical direction and engineering design, including: developing the world’s largest metal 3D printers and the world’s first 3D printed rocket. Hardware is in the 2020’s, the software for it is in the 1980’s.

Jenna Bryant, VP of Creative & Talent

Learning computer aided design tools during her degree in fashion design, led Jenna to a tremendously successful career in tech. It began during the rise of Silicon Beach, and working with startups like Oculus, Tinder & Snap in their early days was her norm. She spent a decade building teams with the most in-demand engineers in the world before transitioning into venture capital and founding Embedded Ventures.

Funding to Date

Last raised: $5M Seed

Total Funding: $6M

Investors:

Embedded Ventures (pre-seed lead), Venrex (seed lead), USC’s Viterbi School of Engineering, Gaingels, Undeterred Capital, Tom Preston-Werner’s Family Office, Nat Friedman, Liquid 2, Madrona Venture Group, Bernie Lagrange, Kelvin Beachum, Matt Terrell

Zoo is Hiring!

How Zoo’s geometry engine unlocks A.I. training

In hardware development, design geometry is the data. Without the ability to talk to the data, there is no ability to train A.I. models. In order to implement A.I. solutions, you need a geometry engine with:

1. High performance GPU computation

2. Dynamic scalability in the cloud

3. Remote access via APIs

Zoo’s geometry engine has all three features, no one else’s has even one of these features.

Products

Infrastructure

Zoo’s APIs are infrastructure for hardware development.

Analogous to OpenAI’s APIs. Targeted at developers building their own products and workflows.

• KittyCAD API: Geometry Engine endpoints for software developers

• ML-ephant API: Machine Learning endpoints for software developers

Tools

Zoo’s Tools are products built on their own infrastructure.

Analogous to OpenAI’s ChatGPT. Targeted at mechanical engineers who want turnkey solutions. These Tools are majority open-source, drive traffic through Zoo’s APIs, and prime our developer base as they build their own products using our APIs. 

• Modeling App: Edit CAD visually or with code

• Text-To-CAD: Generate CAD from text prompts (soon to be part of the Modeling App!)

• Diff Viewer: Visualize CAD changes on Github

Use Cases:

• Generative AI for parametric hardware designs, dramatically reducing design labor. Use a text prompt instead of manually defined geometry with a mouse (think ChatGPT but generating a CAD design instead of text).

• Creating software-defined workflows to automatically generate and modify hardware designs

• Integrating CAD data with other upstream or downstream data systems, such as modifying CAD data based on requirements changes, or modifying manufacturing instructions based on CAD data changes.

• Developing custom applications on top of our APIs, similar to how many companies build products on top of Stripe or OpenAI’s API infrastructure.

Tech

For pre-built mechanical engineering solutions, explore their GitHub to see their full suite of open source tools. 

For software developers building their own solutions → Check out their Docs

• API Reference
  Read the full documentation for Zoo's application programming interface.

• CLI Manual
  Read the manual for the Zoo command line interface.

• Create an API Token
  Visit your account page to create a token, the first thing you need to start building with Zoo's APIs.

• Install a client
  We support clients for TypeScript, Python, Go, and Rust, as well as basic cURL. Install Zoo's sdk in your lingua franca.

• Convert a CAD file with JavaScript
  Follow this tutorial to get your first experience working with the Zoo TypeScript client.

• Convert a CAD file with Python
  This is the same tutorial for our snake_case_loving developers out there.

Viral Demand

With customer posts getting over 546K views, 5.2K likes, 3.3K bookmarks, Text-to-CAD is generating meaningful buzz and usage given the demand for Zoo’s unique products.

Link to X post

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