“The best founders find a way to make it happen”: VC Roundtable with Bryan Kim and David Clark | E2222
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Podcast Summary
This Week in Startups features a venture capital roundtable with Jason Calacanis, Bryan Kim from Andreessen Horowitz, and David Clark from VenCap International. The discussion centers around Bryan's $16M Series A investment in Oboe, an AI-powered learning platform founded by serial entrepreneur Near (formerly of Anchor/Spotify). (03:07) The panel explores current AI valuations, market dynamics, and whether we're experiencing an AI bubble. Key topics include portfolio management strategies, exit timing for early-stage funds, and the evolving nature of startup growth rates in the AI era.
- Main themes: AI investment valuations, venture portfolio management, founder relentlessness, and market opportunities in AI-native applications
Speakers
Bryan Kim
Partner at Andreessen Horowitz focused on consumer AI investing. Previously ran growth at Snapchat and served as a CFO, bringing operational experience to his venture investing approach.
David Clark
Chief Investment Officer at VenCap International, a fund of funds vehicle based near London. Provides LP perspective on venture investing with visibility into multiple fund strategies and performance metrics.
Jason Calacanis
Founder and General Partner at Launch, host of This Week in Startups for over 2,200 episodes. Early investor in Uber and runs accelerator programs including Foundry University.
Key Takeaways
Target High-End Customers First
Jason emphasizes that founders should "start at the high end and work your way down" rather than targeting budget-conscious consumers initially. (55:56) Using education as an example, he notes that affluent parents who pay $500/month for tutoring won't hesitate at $50/month for AI-powered learning, while budget customers create immediate margin pressure. This strategy proved successful for companies like Brilliant.org and Starbucks, where premium positioning enabled sustainable growth before expanding to mass market segments.
Founder Relentlessness Is The Ultimate Moat
The panel unanimously agrees that "the relentlessness of the founder" represents the most defensible business advantage. (63:26) Bryan Kim describes this as the velocity of product shipment combined with distribution ability, while Jason illustrates it through his podcast's longevity despite numerous copycats who couldn't maintain momentum beyond months or years. David Clark emphasizes that "the best founders find a way to make it happen," citing examples like Boom Supersonic's pivot and Crusoe's evolution from Bitcoin mining to AI infrastructure.
AI Growth Rates Justify Premium Valuations
David Clark argues that AI company valuations, while appearing high, are supported by unprecedented growth rates where companies reach $100M revenue in 12-18 months—an order of magnitude faster than previous generations. (07:27) Fall.ai exemplifies this trend, doubling its run rate in just four months after raising in July. The panel suggests evaluating gross margin dollars rather than percentages, as AI companies may achieve lower margin percentages but significantly higher absolute dollar returns due to massive scale potential.
Momentum Through Product Velocity Beats Traditional Moats
Bryan Kim introduces the concept that "momentum is the new moat," distinguishing between revenue growth momentum and product release velocity. (60:24) In the rapidly evolving AI landscape where underlying models change quickly, teams that can build and ship products rapidly while innovating go-to-market strategies (hackathons, influencer partnerships, strategic alliances) outperform those focused on traditional moats. Revenue becomes merely a trailing indicator of successful product velocity and distribution capabilities working in tandem.
Market Creation Through Induced Demand
The discussion reveals how exceptional products create markets rather than simply addressing existing ones. Bryan cites ElevenLabs, which started with a small dubbing market but made voice cloning so accessible and affordable that new use cases emerged organically. (23:48) Jason references William Gibson's principle that "the street finds its own uses for technology," noting how users discover applications that founders never anticipated. This market-creation phenomenon challenges traditional TAM calculations and suggests focusing on world-bending vision paired with demonstrated execution ability in initial market segments.
Statistics & Facts
- ChatGPT has reached 800 million weekly active users, with the average user engaging more than 25 times per week (approximately 4 times daily), demonstrating unprecedented adoption rates for an AI product. (42:00)
- Companies in the AI era are reaching $100 million revenue in 12-18 months, representing growth rates an order of magnitude faster than previous technology cycles. (07:27)
- Labor costs represent approximately 50% of global GDP, translating to a $50-60 trillion annualized market that AI companies could potentially capture through automation and efficiency gains. (45:16)
