Will the Capital Markets Ever Come Back?
All the bankers we know are incredibly busy, but they do not have much to show for it. The capital markets are log-jammed and it is not clear what it will take to free them.
Category Archives: The Valley
Herd Mentality – Why are there so many AI accelerators?
Two decades of under-investment in semis has left US venture firms with little institutional memory for semis investment.
What will Venture Investing Become?
A shrinking number of firm, months and months with no DPI, log-jammed fundraising, too much software and not enough hardware – the venture industry is poised for a profound change.
The Strong Case for Deep Tech in the Age of AI
We long held the belief that there is a strong case for greater Deep Tech venture investing. The rise of machine learning and AI only deepens our conviction on what is likely to be a generational investing opportunity.
Deep Tech Foundations
Hardware will constitute 60% of “Technology” revenue over the next five years, but has received only 10% of venture investments over the past five years. US investors need to pick up the pace to fix that imbalance.
Our $0.02 on LLMs
The latest advances in AI (GPT, LLM, transformers, etc.) are like a Nokia phone in the 90’s – everyone could see the appeal, but no one could predict all that it would lead to.
Our $0.02 on SVB
SVB was the bank of choice for the Valley because they wanted our business. Say what you will about its wind-down process, but commercial banks in the US ignore small businesses, and now it looks like that is all we are left with.
Capital Markets and You – Revisited
We think the market will probably improve later this year, and IPOs & venture funding will pick up pace, but the investing environment will be very different than the long summer we have enjoyed for too long. (Unless your company has AI in its name.)
Hard vs. Soft – With Math
Despite conventional wisdom, building a software company can be just as capital intensive a building a semis company. With the huge disparity in valuations at every venture round, it is clear that there can be a massive opportunity in semis investing.
Hard or Soft?
The risk profile for venture investing in hardware and software are of course very different, but the market is shifting, making hardware investing much more appealing.