Podcast Notes Playlist: Startup

• Most VC firms are not “focused funds” – they’re more general (they invest in a wide range of companies across many different fields). This is different from Zetta – they only invest in AI & machine learning companies.
  • Focused funds get a 16% higher multiple on invested capital and a 33% higher ROI compared to generalist funds 
• The 4 Phases of AI:
  • Phase 1 (low risk): AI applied to consumer applications
    • Ex. – Google and Amazon giving recommendations
  • Phase 2 (slightly higher risk): AI applied to enterprise SaaS companies
    • Ex. – CRMs suggesting leads
  • Phase 3 (high financial risk): AI-centric applications that completely replace a workflow
    • Ex. – Using AI tech to estimate damage on a car, computer vision in autonomous cars, etc.
    • We are currently in Phase 3
    • The key metric for phase 3 AI: Is the efficacy better than a human?
  • Phase 4: (very high financial risk): Applications we haven’t considered before
    • Ex. – Using AI to optimize data center use or energy flow across an electricity grid, making medical diagnoses, etc.
  • Note – In many cases, even if an AI tech has better efficacy than it’s human counterpart, it will still incur adoption risk. Many people are not ready to trust AI as a total replacement for human judgment.
• AI itself shouldn’t be feared. However, AI can create monopolistic power held by a few companies– this is something to be concerned about.

Ash Fontana of Zetta Venture Partners joins Nick to discuss Why SaaS is not a fit for VC and How AI Compounds Competitive Advantage. In this episode, we cover:

• Categories of AI that Ash is most interested in
• The difference between real AI and AI-enabled companies
• Why SaaS will cease to be investable by VCs
• The current AI stage of adoption
• How he times the market
• The four phases of AI
• What phase of AI they invest in
• How AI is and will be affected by limited data
• How startups can compete for talent w/ GAFA (Google, Amazon, Facebook, Apple)
• The moats being created by their AI-first portcos
• How they think about metrics and milestones for AI-backed companies
• If AI should be feared
• and finally we wrap up w/ Ash's thoughts on Chris Dixon's position that we will see a movement from centralization back to decentralization in tech-- and the role that AI will play

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"The most exciting new podcast in the startup world.” - Eric Ries, Founder and NYTimes bestselling author

Today's episode is another deep dive experiment into a topic that every founder dreads thinking about — fundraising. Similar to what we recently did regarding a deep dive on remote work, this episode goes deep (like super deep) into the weeds on fundraising strategies, tactics, and mistakes to avoid.

This is always one of the most asked about topics, and I thought it'd be fun to do an episode with Marc who has helped founders raise over $100m in the last 12 months alone. He shares a lot of nuanced insight on the entire process of getting investors to give you millions of dollars, and getting time with him is not cheap, so I'm glad that he's able to spend a few hours with us for free — enjoy this deep dive with Marc and shoot us notes on any other deep dives you want us to do.

You can email James questions directly at [email protected] or follow us on Twitter @ twitter.com/gobelowtheline — “Below the Line with James Beshara" is brought to you by Straight Up Podcasts LLC.

On the second episode of my educational podcast, I interview the CEO of the largest cryptocurrency company in the world, Brian Armstrong. I knew Brian years ago when Coinbase was a relatively humble startup and it's been mind blowing to see how far they've come in such a short period of time, managing the equivalent of billions of dollars in wealth in cryptocurrency. I admire Brian because he wakes up everyday determined to solve the 'meta-problem' of financial freedom using cryptocurrency, which he believes can indirectly alleviate poverty, increase entrepeneurship, and help reduce corruption in governments around the world. The President of the USA tweeted about Bitcoin and Facebook released it's "Libra" cryptocurrency, so it's an extremely exciting time in the space. I also ask him about his most ambitious ideas regarding the future of payments, and was pleasantly shocked by his answers. Enjoy!