Back from the battle of the Valley.

Back from the
battle
of the Valley.
A series of posts. Part 1. What the hell it’s even about there and why it’s about there.
The Valley got resurrected with the arrival of AI. Like, a huge amount of everything, including posters on Highway 101, is ads for AI companies; maybe 1 out of 10 billboards isn’t about AI.
With what they pitch on every corner in a coffee shop, and the fact you can genuinely run into a Sequoia Capital partner in a coffee shop, I guess you won’t surprise anyone anymore. Let’s get to the point.
About funds. An interesting effect has cropped up. Pretty much all previous software waves were evaluated by investors using old yardsticks and, in general, it worked, and basically the same top funds (say, a16z условный) stayed top. In my feel, the situation has changed. Partners in top funds are stuck in late-2010s frameworks and don’t understand what’s going on and where to invest. So they just wait for it to hype. Based on conversations, my top funds list goes like this, in this order:
1.
https://www.conviction.com/
2.
https://accel.com/
3. Everyone else, though for fairness’ sake I didn’t manage to have a normal talk with Sequoia. But a16z and the rest of that crowd didn’t make me happy at all (a very weak understanding of what AI is, who needs it, and what’s happening there, partially patched by the fact their portfolio has solid late-stage companies and all the lessons and conclusions come from there).
Quote from one partner: money isn’t the problem. The problem might be in:
1/ a team without industry experience (for example you don’t have researchers or ML engineers with work experience from before the AI hype)
2/ you don’t know what’s going on in the market (and investors do and won’t share haha)
3/ commercial or product validation (here everything’s easy and as usual and this is a criterion from the past)
A lot of technical partners in a lot of funds, and pretty much everywhere some условный fund CTO has appeared. Because there’s gotten to be a ton of bullshit.
A photo from Yosemite park for attention.