The Full Ratchet (TFR): Venture Capital and Startup Investing Demystified Investor Stories 380: Disruptive Forces (Droesch, Patil, Chase)
Dec 26, 2024
Investors discuss the potential disruptions reshaping the venture capital landscape. They highlight how artificial intelligence could enable smaller teams to launch profitable businesses more efficiently. The conversation also dives into innovative meal kit solutions and partnerships, exemplified by Tovala's collaboration with Costco. With insights on market challenges and funding dynamics, the future of capital flow across different stages is examined, along with the implications of these changes for the next decade in the industry.
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AI's Impact on VC
- AI could disrupt VC by enabling smaller teams to build large businesses.
- This increased efficiency might reduce the need for substantial capital.
Capital Flow Disruption
- Current capital flow is concentrated in early-stage and late-stage (Series D+).
- The lack of funding in Series B and C creates pessimism and slows innovation.
AI Business Model Evolution
- AI-driven business models will shift from seat-based pricing to outcome-based pricing.
- This change will impact growth curves and require different underwriting approaches.