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🤖 Everything in AI

AI Enterprise Market Map: Cutting through the hype

Lightspeed aims to cut through the hype and identify pockets of value in enterprise AI:

1. While the application and foundational model layer have seen an explosion of startups, the platform enablement layer still needs to catch up (i.e., the middleware platforms that perform essential but less glamorous tasks like labelling massive training datasets)

2. Thoughtful UIs will be required to accelerate growth (i.e., UI adjustments will be required to make enterprise AI more accessible)

3. Vertical-AI will push tech-averse industries to adopt AI (e.g., healthcare, legal, biotech, and finance)

4. The real long-term impact of AI lies in system integration (i.e., combining GenAI into the broader AI architecture of an enterprise rather than one-off use cases)

5. Incumbents are beginning to strengthen their AI offerings as software giants are attempting to rebrand themselves as AI companies

👉️ Read the full article here

Every White-Collar Role Will Have An AI Copilot

a16z explores the transformative role of AI copilots and agents in white-collar jobs:

1. AI Copilots are enhancing productivity by automating routine tasks. Studies show that companies utilizing AI tools can increase employee efficiency by up to 40%, allowing workers to concentrate on more complex, creative responsibilities.

2. The effectiveness of these AI tools is heavily influenced by user interaction; therefore, organizations must invest in training and adaptation to maximize benefits.

3. Applications extend beyond simple queries to more complex tasks, such as booking travel or managing schedules. This suggests a shift toward more agentive AI capabilities that can significantly impact business operations.

4. As AI evolves, workers will need to develop a hybrid skill set combining technical abilities with creative problem-solving. A recent survey indicated that 60% of employees are willing to adopt AI tools to improve their job performance.

👉️ Read the full article here

🫅 People & Talent

Founder Factory: The next generation of startups in EMEA

Accel dives into the development of talent across Europe and Israel, specifically in the AI space.

Analysis of the cohorts of talent in the space found that these founders typically spend 2yrs+ at a unicorn, and most founded their own start-ups within a year of leaving.

Across the region, the key hotbeds for start-up creation (driven by talent, regulatory barriers, and many other factors) are London, Tel Aviv, Berlin, Paris and Amsterdam.

Europe and Israel are poised to produce a wave of category-leading GenAI companies as the region’s world-class universities and big tech companies’ local research labs fuel this new wave of founders.

👉️ Read the full article here

2024 HR Report

In the Softbank’s 2024 HR Report: several insights indicate that hiring is once again a top priority for tech companies:

1. Increased Hiring Activity: 69% of surveyed companies are actively recruiting for specific roles, a notable increase from the previous year. Additionally, 19% plan to expand hiring across their organizations, reflecting a recovery from earlier layoffs.

2. Easier Talent Attraction: 46% of Chief Human Resources Officers (CHROs) reported that attracting talent has become easier in 2024, signaling a more favorable hiring environment compared to previous challenges.

3. AI Tools Utilization: Companies are increasingly incorporating AI tools into their hiring processes, with a significant 48% of HR leaders acknowledging that generative AI has positively impacted their departments. These tools are enhancing efficiency in recruitment and streamlining onboarding processes.

4. Competitive Hiring Landscape: The report highlights a renewed focus on securing talent aligned with growth strategies, as organizations adapt to market changes and embrace flexible work arrangements.

👉️ Read the full article here

📈 Finance & Liquidity

Scaling SaaS: Forging Excellence Through Fundamentals

Iconiq analyses the growth & efficiency of software businesses in both the public and private markets.

They find that while in public markets multiples have compressed, Gen-AI related hype is yet to be seen on the P&L so mutliples remain weary of recovery.

In the private markets, top-line growth has dropped significantly (due to no new logo growth), impacting dealmaking and multiples. Iconiq also revists a few of their predictions and how they are performing:

1. Rise of usage based pricing (Iconiq finds no real change)

2. Expansion revenue (selling new products to existing customers) will grow (Iconiq found that given new logo growth is down but revenue is growing, expansion revenue remains important

3. Rule of 60 (Iconiq argued that the classic Rule of 40 will become Rule of 60 given new efficiencies / value from AI, but found this impact is not here yet)

4. Profitability before IPO (indeed more companies are profitable at later-stage, yet this remains too early to tell given IPO markets remain silent)

👉️ Read the full article here

IPO readiness: Lessons from the field

Vision Fund explores the critical steps for companies transitioning from private to public:

1. Dedicated IPO Teams: It’s essential to establish a specialized IPO launch team that focuses solely on the public offering process, ensuring that key resources remain dedicated to core business operations.

2. Financial Controls: Robust financial controls and compliance with regulations (like SOX in the U.S.) are crucial for gaining investor confidence. This includes investing in real-time forecasting capabilities to facilitate accurate financial reporting.

3. Investor Relations Strategy: Successful companies, such as Delhivery, emphasize the importance of refining their story over time and involving senior leaders in the narrative creation for their IPO documentation. Tailoring communication for different investor levels enhances engagement during roadshows.

4. Strategic Stakeholders: Companies should focus on long-term relationships with supportive investors while managing their expectations effectively during the IPO process.

👉️ Read the full article here

🗞️ The Startup Pulse

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See you next week!

Rahul & Aryaman

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