The Venture Capital Challenge

I just had a mind-blowing experience that's convinced me: AI is going to revolutionize the venture capital industry, and frankly, we humans might be in trouble.

Let me set the stage. At Huly, we often get approached by investors, some managing billions. Recently, I've been avoiding these conversations. Why? Because most of these folks, despite their Ivy League degrees and fancy titles, often lack the deep understanding needed to truly grasp the complexity of what we're doing.

Huly: More Than Just Another Startup

Huly is more than just a tech startup. We have two facets to our business. First, there's the current Huly - a collaboration and productivity tool that's already available and loved by our users across various industries. It's designed to benefit everyone, from creatives to managers, and yes, developers too. But that's just the beginning. We're also developing the next-generation Huly, which is where things get really complex and exciting.

This next-gen Huly will be blockchain-based and aims to be an enabler of the remote worker economy. It's a multifaceted project that sits at the intersection of technology, user experience, product innovation, and economics. We have some exciting ideas from a product perspective that could revolutionize how people work and collaborate. We're not just building a product; we're creating an ecosystem. This includes the Huly Foundation, a non-commercial organization responsible for the governance of the Huly Project. You can learn more about the Foundation's structure and goals at https://huly.foundation/bylaws/.

The Communication Gap

Now, imagine trying to have a productive conversation about all of this - from our current product to our future vision, encompassing its broad appeal and technical complexities - with someone who has a limited understanding of technology and how diverse teams collaborate in the modern workplace. It's like trying to explain the intricacies of a symphony to someone who's only ever heard a single instrument.

Or picture this: you're discussing the blockchain architecture for our next-gen product, and an investor confidently suggests using ZK-SNARKs in a context where it's completely inappropriate. In the Web3 world, some investors throw around complex terms without understanding what they are or what they're for, much like how some VCs suggest "adding AI" to every product they see.

Enter the AI Investor

But here's where it gets interesting. I recently had the chance to interact with an AI in an investor context. And let me tell you, it blew my mind.

In just 15 minutes, this AI grasped concepts about both our current product and our next-gen vision that usually take me two hours to explain to human investors - and even then, understanding isn't guaranteed. It typically requires knowledge across different domains and significant experience to fully comprehend what we're doing.

But this AI? It understood everything I said, built a correct picture of our product ecosystem and vision, and even filled in missing information with its own thinking - correctly. Most impressively, it summarized everything in 20 seconds in a way that I couldn't have done better myself.

The AI Advantage

This experience made me realize: AI isn't just coming for coding jobs or customer service. It's coming for the suits in Sand Hill Road too. And honestly? It might be a good thing.

Think about it. An AI investor doesn't care about your Ivy League degree or your golf handicap. It won't be swayed by a charismatic pitch or a fancy PowerPoint. It'll evaluate your startup based on cold, hard data and the merit of your ideas, without throwing around buzzwords it doesn't understand.

The Investment Decision: Where AI Truly Shines

Now, I can already hear some of you saying, "Okay, maybe AI can evaluate a startup, but what about making the actual investment decision? Surely that requires human judgment?"

Well, let me let you in on a little secret: this is actually the easiest part of the process, and it's where most investors aren't even fully utilizing their brains. The reality? Most investors simply take your startup's economic data, plug it into a spreadsheet, and let Excel tell them whether it's worth investing or not.

This is precisely where AI would undoubtedly outperform humans. An AI system could analyze vast amounts of historical investment data, current market trends, and your startup's metrics in seconds. It could run complex simulations, consider countless variables, and provide a much more nuanced and accurate investment recommendation than a simple Excel formula.

Moreover, AI wouldn't suffer from the biases that often cloud human judgment - like favoring startups with ivy league founders or getting swayed by a particularly charismatic pitch. It would focus solely on the potential for success and return on investment.

The Human Touch Dilemma

Sure, you might say, "But what about the human touch? The mentorship? The network?" Valid points. But let's be real - how many VCs actually provide meaningful mentorship beyond introductions to their buddies? An AI could potentially offer more tailored, data-driven advice and connections, without suggesting you blockchain your coffee machine.

The Future of Venture Capital

Now, I'm not saying human VCs will disappear overnight. But I am saying that the VCs who adapt and learn to work alongside AI will have a massive advantage. And startups? They might finally get the fair, unbiased evaluation they deserve, free from misused tech jargon and misplaced buzzword suggestions.

Of course, this raises bigger questions. If AI can do VC better than humans, what other industries are next? Are we looking at a future where AIs are not just our tools, but our bosses? Our investors? Our decision-makers?

A Revolution in Capital Allocation

It's a wild thought, and honestly, it's a little terrifying. But it's also exciting. Because if this AI interaction is any indication, we're on the cusp of a revolution in how we allocate capital and resources in our society.

So to all my VC friends out there: the AI revolution isn't just coming for the startups you invest in. It's coming for you too. The question is, are you ready to compete with an investor that actually understands what ZK-SNARKs are - and when not to use them?

AI: The Future of Venture Capital