The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:31:07 · Harry Stebbings, Jason Lemkin
[00:31:07] S3: We have Nematron, we have Thinking Machines, we have Reflection. In twelve months' time, what percentage of token in open source flow will go through US versus Chinese? [00:31:20] S2: Well, look, just two things. As Dev made the point in the beginning, developers will change and and especially here. This is a lot easier than swapping out your database. Right? That that that could be done, but I... Having recently done it, it's some work, man. I gotta tell you. It's not... Even with an LLM, it's... I mean, listen, this is still work. You have to qualify your prompt. You have to redo your workflows. It's not nothing like the internet says, but I could see it being half in twelve months. Twelve months is a lot of time. And I think sovereignty plus U. S. Based is really important. I'm not saying it will happen because I don't know that again, I'm skeptical the parity is really there versus pretend there. But if if you're even x minus three months to Dev's point, it could be half in a year. A year is a long time. [00:31:58] S3: But that gives me a lot of confidence. I... I'm I'm an investor in fireworks, as is Sequoia. And I think the biggest concern I would have as if Fireworks or a base 10 or a Modal investor would do is that actually big enterprises are concerned about Chinese models, and that would prevent them from engaging with partners like Fireworks or Modal, and they then go to Frontier. And so the fact that you say 50% shows me that the the levels or quality you think is sufficient enough that it would be that rate, that makes me excited.
00:31:58 · Harry Stebbings, Dev Ittycheria
[00:31:58] S3: But that gives me a lot of confidence. I... I'm I'm an investor in fireworks, as is Sequoia. And I think the biggest concern I would have as if Fireworks or a base 10 or a Modal investor would do is that actually big enterprises are concerned about Chinese models, and that would prevent them from engaging with partners like Fireworks or Modal, and they then go to Frontier. And so the fact that you say 50% shows me that the the levels or quality you think is sufficient enough that it would be that rate, that makes me excited. [00:32:25] S1: I think the other thing that enterprises are gonna care a lot about above and beyond cost is safety, being able to trust these systems. And I think we're just getting focused on this. Obviously, there's a big conference last week in Washington. It's clear that there's gonna be some self regulating approach to figuring out how to address safety. The challenge is how do you define safety. Right? Because if someone knows how to define it well, I'm I'm really curious, but it's it's... Beauty is in the eye of the beholder. But we need some way or some mechanism for people to be able to determine much like a benchmark. And yes, people can game a benchmark is like how safe are these models? The more safe these models are with whatever mechanisms are placed to prevent people from doing bad things, the more widely usable they'll become.
00:32:25 · Dev Ittycheria, Rory O'Driscoll
[00:32:25] S1: I think the other thing that enterprises are gonna care a lot about above and beyond cost is safety, being able to trust these systems. And I think we're just getting focused on this. Obviously, there's a big conference last week in Washington. It's clear that there's gonna be some self regulating approach to figuring out how to address safety. The challenge is how do you define safety. Right? Because if someone knows how to define it well, I'm I'm really curious, but it's it's... Beauty is in the eye of the beholder. But we need some way or some mechanism for people to be able to determine much like a benchmark. And yes, people can game a benchmark is like how safe are these models? The more safe these models are with whatever mechanisms are placed to prevent people from doing bad things, the more widely usable they'll become. [00:33:09] S0: Agreed. And I wouldn't guess, by the way, 50%, Harry, but I think even 10 or 20% would be extremely significant in terms of tokens. Because if you think about it, the foundation models on OpenRider, I think, get 20%, 30% of tokens and get 90% of the dollars. If The US open weight models are even 50%, 60% of that in terms of tokens, That's a lot of traction because it'll be by definition the more enterprise centric, safety conscious customers doing it. So I think that would be a, frankly, a huge triumph for reflection. And as you point out, a real derisking for all the inference guys.
00:33:09 · Rory O'Driscoll, Harry Stebbings
[00:33:09] S0: Agreed. And I wouldn't guess, by the way, 50%, Harry, but I think even 10 or 20% would be extremely significant in terms of tokens. Because if you think about it, the foundation models on OpenRider, I think, get 20%, 30% of tokens and get 90% of the dollars. If The US open weight models are even 50%, 60% of that in terms of tokens, That's a lot of traction because it'll be by definition the more enterprise centric, safety conscious customers doing it. So I think that would be a, frankly, a huge triumph for reflection. And as you point out, a real derisking for all the inference guys. [00:33:45] S3: Ding. Ding. Ding. We got investment committee. Dave, welcome to the committee, by the way. We're thrilled to have you as part of the investment team. You are, as arduccio see, on the new new firm that is O'Driscoll, Lemkin, Stebbings. Jason, we have 11 labs who doubled their valuation to $22,000,000,000 Would we do 22,000,000,000?
00:33:45 · Harry Stebbings, Jason Lemkin
[00:33:45] S3: Ding. Ding. Ding. We got investment committee. Dave, welcome to the committee, by the way. We're thrilled to have you as part of the investment team. You are, as arduccio see, on the new new firm that is O'Driscoll, Lemkin, Stebbings. Jason, we have 11 labs who doubled their valuation to $22,000,000,000 Would we do 22,000,000,000? [00:34:06] S2: I think at 22,000,000,000, we should consider doing up to 10% of the fund. Time is short. We're at an eighteen month deployment cycle. One of our most esteemed partners is going back to run a public company so we're losing some of the folks on the team. The way I see it, eleven Labs has done something quite different with actually a fair amount of intense competition. Its lead keeps widening. It is one of the 10 most important underpinnings of AgenTeq applications is their voice applications, where they're going. The rate of growth and surprisingly the margins are very impressive. This is a company that by the time we close the friend and families round, which we're hoping to do at $50,000,000,000 right? This one could be approaching 1,000,000,000 in revenue. And that's the sort of growth rate that I think it's the deal we've got to do. And it's a highly differentiated. I won't say they have the highest mode out there in the world, but this is no, this isn't JEV level risk. Eleven Labs has built an incredible team. They have sub millisecond response rates for voice, which has become a key modal. And it's tough to find a better asset today. Do I wish it was at '21 or '18? For sure, but I say we go all in.
00:34:06 · Jason Lemkin, Harry Stebbings
[00:34:06] S2: I think at 22,000,000,000, we should consider doing up to 10% of the fund. Time is short. We're at an eighteen month deployment cycle. One of our most esteemed partners is going back to run a public company so we're losing some of the folks on the team. The way I see it, eleven Labs has done something quite different with actually a fair amount of intense competition. Its lead keeps widening. It is one of the 10 most important underpinnings of AgenTeq applications is their voice applications, where they're going. The rate of growth and surprisingly the margins are very impressive. This is a company that by the time we close the friend and families round, which we're hoping to do at $50,000,000,000 right? This one could be approaching 1,000,000,000 in revenue. And that's the sort of growth rate that I think it's the deal we've got to do. And it's a highly differentiated. I won't say they have the highest mode out there in the world, but this is no, this isn't JEV level risk. Eleven Labs has built an incredible team. They have sub millisecond response rates for voice, which has become a key modal. And it's tough to find a better asset today. Do I wish it was at '21 or '18? For sure, but I say we go all in. [00:35:08] S3: Can I ask you, mister Lampkin? You previously said on the show that this would be the year of substitution for voice models and that cost would drive that decision. Have you changed your mind?