What's 🔥 in Enterprise IT/VC #309

On shiny new objects like generative AI in startup land + starting companies for the right reason

Ed Sim

Oct 1

▷ Listen

SAVE

We have a new shiny object for founders and VC alike, and it’s called generative AI.

Ed Sim @edsim

The new buzzword in VC and startup land is generative AI - every other pitch seems to be the generative AI of X - with all of these startups being created, I don't think we will have any humans left 🤣.

Due to significant improvements in models, compute, and datasets, AI which was once relegated to the realm of analysis only has become all about creation. Some early examples showcasing the power of AI for human-like creation include DALL-E which is a simple text-to-image generator and Github Co-pilot which is an AI paired programmer and code generator. Here’s an image I created using DALL-E using the text “oil painting of silicon venture capitalist throwing bags of money at AI robot".”

As you can imagine, founders and VCs alike are racing to discover all of the open categories which have not yet been disrupted using Generative AI ranging from creation of email copy for outbound sales to image generation for social media to dozens upon dozens of code generators. Don’t get me wrong - this is just wave 1 and there will be some groundbreaking companies created in this space. The problem is that the barriers to entry are limited, and when everyone thinks it’s a great idea, then well, the market will get crowded and overfunded fast. @swyx covers it well below.

swyx 🌴 @swyx

The AI Red Wedding: - GPT3/Jasper 🔪 Low value copywriters - Stable Diffusion 🔪 Stock image companies - OpenAI Whisper 🔪 Voice transcription APIs Every month a sleepy industry that hasn't changed for years gets AI'ed. Which is next?

And if you believe this is the future, then one day everything you read, hear, or watch could be AI generated?

Sam Altman @sama

in a few years, the important distinction won't be bot vs. human, but NPC (human or AI) vs. not

As with any new technology, my only suggestion is that if you’re a founder thinking about creating a company in this space, don’t! Always start with the burning pain you are trying to solve, figure out what unique insight you have which will make a user’s life 10X better or more, and then decide what tech to use. Yes, the tech should come last, and if you are going to leverage generative AI to help solve customer problems then great. You may create the next big thing. However, when it comes to buzzwords, there will be hundreds of founders who will start the other way around with the tech first and look at market maps to determine which category in generative AI has not been done yet.

The first group of founders are what I call mission driven while the second I would call whiteboard founders. My personal bias is to always fund the founders who start with customer pain vs. looking for white space. When lifelong mission to solve a massive customer pain meets generative AI, then by all means go build a company but remember not to lost sight of solving the customer problems always!!!

If you’re an investor, I get that generative AI is super cool but invest for the right reasons and not because you’ve market mapped it and determined I need to have one of those.

As always, 🙏🏼 for reading and please share with your friends and colleagues.

Scaling Startups

💯 Being candid means you truly care - in startup land, time is money and you need to be direct and candid and not wait
Adam Grant @AdamMGrant
The people who are nice to you aren’t always being kind to you. Saying what you want to hear is nice. People sugarcoat feedback to make you feel good today. Sharing what you need to hear is kind. People speak honestly to help you do better tomorrow. Candor is an act of care.
September 25th 2022
1,703 Retweets8,545 Likes
💯 although having both is even better
Ethan Mollick @emollick
Forget 10x engineers, go for 10x teams. This paper analyzes 200k teams ranging from sports to politics, and finds that performance follows a power law 70% of the time. So there are a lot of star teams & those teams perform much better than average ones. pubsonline.informs.org/doi/10.1287/or…
September 30th 2022
94 Retweets659 Likes
Looking to get energized for the day? Learn from the best
Andrew D. Huberman, Ph.D. @hubermanlab
Optimal morning routine from Huberman Lab Podcast summarized and animated by the one and only “After Skool” The Optimal Morning Routine - Andrew Huberman The Optimal Morning Routine - Andrew HubermanAndrew Huberman, Ph.D., is a neuroscientist and tenured Professor in the Department of Neurobiology at the Stanford University School of Medicine. He has mad...youtu.be
September 27th 2022
247 Retweets1,857 Likes

Enterprise Tech

On the heels of announcing our investment in Steadybit which is shifting chaos testing and resilience engineering ⬅️, we’re pumped to announce the Series A for Jeli, a one stop incident response tool
Ed Sim @edsim
LFG! Recover from downtime faster - slack incident bot now free along with world class incident analysis platform Congrats @nora_js @jeli_io on $15M A led by our friends at Addition Capital Thrilled to be day one partner + double down @Boldstartvc @etdurbin
Jeli.io @jeli_io
We're thrilled to announce our $15Million Series A to further our mission of building the best product to help you learn from your incidents 🎉 A big thank you to our investors, the community, and our wonderful team of Jeli beans 🤗🚀 https://t.co/t5I4BCMyCY
September 28th 2022
1 Retweet12 Likes
Did someone say generative AI? Sequoia market map…
Meta make a video - yes, more generative AI
Meta AI @MetaAI
We’re pleased to introduce Make-A-Video, our latest in #GenerativeAI research! With just a few words, this state-of-the-art AI system generates high-quality videos from text prompts. Have an idea you want to see? Reply w/ your prompt using #MetaAI and we’ll share more results.
September 29th 2022
1,838 Retweets7,846 Likes
Congrats to Marc and AtomicJar (a portfolio co)! Great post on why Marc joined from Datadog
Marc @mtremsal
VCs need only be right 10% of the time. The rest of us lowly employees better be 💯 sure when we join a startup! Back in 2017 it took me 9 months to find @datadoghq. This time it took 9 months to find the fine folks at @AtomicJarInc. Here's my thesis: marc.trems.al/atomicjar/
September 28th 2022
3 Retweets32 Likes
When I first joined Datadog, I had a lot of people ask me why I was so excited. I would proudly explain that "people want traces, metrics, and logs in a single platform" or "monitoring and ITSM are broken in cloud-native environments" and ... it mostly wouldn't click. Turns out, you can't just make bold claims and expect people to believe you unless you're ready to argue why.
In related news, several people have asked me why I'm so excited about joining AtomicJar.
It's all about "shifting integration tests left", "shortening dev cycles" and "getting rid of broken staging environments". But don't just take my word for it, read on!
Let’s go - if you haven’t checked out Cloudflare workers, then now is the time. Liveblocks is building on it and we also have one in stealth doing so as well. 🔥 up for my fund boldstart to be a part of this
Shomik Ghosh 🇺🇦 @shomikghosh21
We @Boldstartvc are excited to support startups building on @Cloudflare Workers 🎉 @liveblocks a portfolio co, currently uses Workers & Durable Objects to provide APIs to devs efficiently! We hope to find & support many more in the future Congrats @miawang__ on this launch 🚀
Cloudflare @Cloudflare
The world’s leading venture capitalist firms commit $1.25 BILLION to back startups built on Cloudflare Workers. https://t.co/ZD0Sa0vPBA #BirthdayWeek🎂
September 27th 2022
6 Retweets39 Likes
WASM has been a 🔥 topic with infra founders and investors on the server side as of late but what’s slowing it down? Standards based or Proprietary (The New Stack)?
The future of WebAssembly — beyond the browser at least — seems to reside in the Component Model. But we should also look beyond it to the wider software market.
“There’s going to be venture-backed competition to occupy this space,” Wingo predicted. “Some of this might trickle down to standards but I think a lot of this is going to be proprietary lock-up.”
This is perhaps a natural evolution of what the likes of Shopify and Fastly are doing now; the question is how easy will it be for vendors to package up WebAssembly into edge compute solutions
More on WASM
Chase Roberts @chsrbrts
The future looks bright for WebAssembly b/c resolves a few software development anti-patterns. 🤩 Thanks to @Hectaman @technosophos @cohix @martin_casado for the insights! chsrbrts.medium.com/webassembly-th…WebAssembly: The Future Looks BrightI recently co-hosted a webinar with Martin Casado of a16z and the founders of three software companies driving the adoption of server-side…chsrbrts.medium.com
September 26th 2022
9 Retweets55 Likes

Markets

Must read on where we are in terms of interest rates and valuations from leading valuation expert and NYU Professor of Finance
Aswath Damodaran @AswathDamodaran
Inflation has been the big story of 2022, driving markets and pushing central banks and policy makers to react. I update my posts from earlier this year on inflation to reflect what we learned this summer about inflation's persistence & unpredictability. Reaping the Whirlwind: A September 2022 Inflation Update!A blog about markets, finance and all things money related.bit.ly
September 26th 2022
277 Retweets1,421 Likes
TripActions confidentially files for IPO aiming for $12B valuation (Business Insider)
TripActions, a startup last valued at $7.25 billion that aims to modernize business travel, has filed confidential paperwork with the U.S. Securities and Exchange Commission to go public next year, according to a person with direct knowledge of the matter.
Founded in 2015 by Ariel Cohen and Ilan Twig, the Palo Alto-based company helps businesses manage travel, company cards and expenses for employees. Customers include Lyft, Shopify, Unilever, Adobe, Netflix, Rivian, Thomson Reuters, Heineken, Notion, Canva, Carta, Loom, Databricks, and Patreon.
The company is being represented by Goldman Sachs in the listing, which is being targeted for the second quarter of next year at a $12 billion valuation, added the person who asked to remain anonymous because he was not authorized to discuss the IPO. His identity is known to Insider.
Overall thoughts on IPO market from Bill Ford, General Atlantic (CNBC)
The fundamental shift in the public markets has taken place, with investors reconnecting to fundamentals and “getting in touch with what a sustainable growth rate of companies is,” Ford said at the conference. But that reset for companies that are growing without profits hasn’t fully translated to the private markets yet.
“It will take some time for entrepreneurs to accept that growth is priced differently, and we have a stalemate now,” he said of the reset forced by shrinking P/E ratios on the S&P 500. “We’re waiting for that,” Ford said, adding that "it will clear itself in a few years."