Take a look at these companies:
Facebook… Airbnb… Coinbase… Instagram… Stripe… OpenAI… Robinhood.
These are some of the most successful startups of our generation.
But can you guess the one key thing they have in common?
Today I’ll reveal the answer.
Then I’ll explain why — if you want to invest in the next startup that’ll land on this list — you shouldn’t fire me. At least not yet.
Marc Andreessen – Architect of the Internet Age
This is Marc Andreessen:
Andreessen is one of the great technology visionaries. He’s responsible for nothing less than shaping the modern internet.
In the early 1990s, he co-created Mosaic, the first user-friendly web browser. He then co-founded Netscape, whose IPO helped ignite the first internet boom.
Today, Andreessen is best known as the co-founder of venture capital firm Andreessen Horowitz (“a16z”). His firm was an early investor in every startup I mentioned above: Facebook, Airbnb, Coinbase, Instagram, Stripe, OpenAI, Robinhood, and many others.
Furthermore, his 2011 essay, “Software Is Eating the World,” became a prophetic call for the digital transformation of every industry.
Given his success, his gravitas, and his ability to predict the future, his opinions about new investment trends carry enormous weight.
And this is where some recent comments he made become highly relevant.
Let me explain.
Will AI Replace Me?
In my role as Chief Investment Officer of Crowdability, I aim to find the best startups for you to invest in.
And our track record of finding 10-baggers (Cruise, BetaBionics, etc.) speaks for itself.
But could there be a better way? Specifically, could AI do my job better than I can?
After all, AI tools are increasingly able to do the types of analysis and research that I do — from performing due diligence on founders, to assessing markets, to modeling financials.
For example, in 2023, Tribe Capital incubated a company called Termina, an AI startup focusing on quantitative due diligence. Similar tools include Hebbia.
Certainly, the use of AI for investing in the stock market is already gaining steam. For example, Norway’s $1.7 trillion sovereign wealth fund has started using predictive trading software.
Will the same thing happen in the private markets?
Not according to Andreessen…
You Can’t Replace “Je Ne Sais Quoi”
According to Andreessen, and as reported by PitchBook, investment analysts like me aren’t going anywhere. Andreessen argues that no amount of AI can replace the human je ne sais quoi of early-stage investing.
As he explained:
“There’s an intangibility to it, there’s a taste aspect, the human relationship aspect, the psychology [...] and when the AIs are doing everything else, that may be one of the last remaining fields that people are still doing,” he said.
Keval Desai, managing partner at venture firm Shakti, agrees: “Early-stage VC is like picking Michael Jordan in kindergarten — when there isn’t much data available to feed into an AI model.”
Google seems to agrees, too. Its venture arm, GV (formerly Google Ventures), used to make invest/don’t invest decisions based on an algorithm. But in 2022, it killed this approach.
I’m Happy To Keep My Job — For Now
So, could Artificial Intelligence do my job better than I can?
Maybe one day. But not yet.
That being said, I do use some powerful technology to help me do my job.
And next week, I’ll tell you about it — and explain how to get your hands on it.
Until then…
Happy Investing.
Best Regards,
Founder
Crowdability.com
