Venture capitalists have always been all about investing in companies that use technology to shake up old industries or create brand new ones. But, hey, some VCs are mixing things up by ditching the whole startup funding game and going for mature businesses instead. They’re snatching up places like call centers and accounting firms, then throwing in some artificial intelligence to automate things and serve more customers. It’s like a private equity roll-up, but with a techie twist.
Lately, big players like General Catalyst, Thrive Capital, and solo VC Elad Gil are all about this new investing trend. General Catalyst is going all in, calling it a whole new asset class and backing seven companies already. One of them, Long Lake, is all about making homeowners associations easier to manage by using automation. In just under two years, Long Lake has raked in a whopping $670 million in funding. Not too shabby, right?
And guess what? Other VCs, like Khosla Ventures, are eyeing this new approach too. Khosla Ventures usually takes risks on untested technologies, so this move into AI-optimized businesses is pretty interesting. Samir Kaul of Khosla Ventures says they’re open to the idea and might give it a shot. If this trend takes off, it could be a game-changer for AI startups. Pairing up with established businesses could give these startups a leg up in the industry.
But hold your horses, Khosla Ventures isn’t going all-in just yet. They want to dip their toes in the water and see how it goes before committing to a big investment. Kaul is all about playing it safe and making sure they don’t mess up their solid track record. After all, they’re dealing with other people’s money here. If things go well, they might team up with a PE firm to handle acquisitions. They’re not in this alone, and they know it.
Marina Temkin over at TechCrunch knows all about venture capital and startups. Before TechCrunch, she was all about VC at PitchBook and Venture Capital Journal. And hey, she’s got a CFA charterholder designation, so she knows her stuff. Venture capitalists are shaking things up, and it looks like things are about to get even more interesting in the world of tech investing. Let’s see where this wild ride takes us next!
