GFT Ventures Q1 2024 Update
Welcome to the Q1 2024 newsletter from GFT Ventures! We hope you will benefit from our fund updates and portfolio company highlights, as well as our overall industry observations and thought leadership exchanges. Please feel free to share our newsletter with your colleagues and friends using the “Share” button at the bottom of this post. Any additional questions or comments may be directed to team@gft.vc. And you can always visit our GFT Ventures website to learn more about us.
GFT Ventures - Looking Ahead to 2024
We’re extremely pleased to report that despite the challenging economic landscape, 2023 proved to be a productive year for GFT Ventures. Venture capital faced numerous challenges, including the collapse of Silicon Valley Bank and First Republic Bank, a stagnant IPO market, and widespread down rounds; the year was a test for the industry. Firms are closing the books on a year in which virtually everything—deals, exits, fundraising—plunged.
Against this backdrop, we not only met but exceeded our expectations. Our accomplishments in 2023 include closing our fund at $140M, well exceeding our $100M target. We invested in three amazing companies identified through our proprietary deal flow pipeline (our most recent investment in Bria is highlighted below). Additionally, we continued working in close collaboration with our portfolio companies, striving to ensure their success and optimize their potential amid economic challenges.
We are already extremely excited about 2024, and fully energized by the fantastic opportunities we are seeing. Developments in AI and data science continue to advance at a rapid pace, and there is now unprecedented global interest in AI and associated startups. The incredibly rapid and widespread adoption of large language models such as ChatGPT, with commercialization / competition from tech industry giants like Microsoft, Google and Meta, had added a significant boost to the overall AI ecosystem. Because we saw this all coming several years ago, we’ve been able to successfully position GFT Ventures as early / recognized AI thought leaders, actively contributing to steering the most significant technological disruptions of our time.
Notwithstanding our overall excitement about current industry developments, not everything we are seeing makes sense to us. For example, we are closely monitoring the significant hype around high-profile AI / LLM (large language model) startups, and their extreme valuations. Although we have been offered some of these opportunities, we have purposely avoided them. Instead, we have chosen to focus on vertical-specific early-stage companies with top-tier teams and deep domain expertise. And we lean in when we discover valuations that are logically aligned with product development and revenue profiles. The trend of “most” startup valuations finally converging to historically "normal" (i.e. attractive) levels continues to provide substantial opportunities for our Fund.
In closing, we strongly believe that what we are now witnessing represents only the initial phase of a multi-decade cycle of progress in accelerated, data-driven computing. This trajectory is anticipated to yield some of the most valuable technology franchises the world has ever experienced.
With Gratitude,
Jeff Herbst and Jay Eum
Founding Managing Partners, GFT Ventures
Featured Portfolio Companies
GFT Ventures co-led Bria’s $24M Series A round with Intel Capital
What it does:
Bria is an enterprise-grade, copyright-safe visual generative AI platform. The company has built a visual generative AI platform (foundation model, web app and API) where enterprise users can create, modify, and upload AI-generated visuals for social media posts, ads, and e-commerce listings in a responsible and ethical manner. The platform is set up so that employees with or without specialized design skill can generate marketing images that can be integrated into existing products, solutions, or systems as a source code, which mitigates the need for companies to hire additional designers.
Why we found it exciting:
Unlike other players in the visual generative AI space, Bria was built with AI ethics and compliance (copyright, privacy, content safety) in mind since its inception. They have partnered with 18 major stock image providers, including Getty, Alamy, SuperStock and Envato, to source over one billion licensed images to train their text-to-image models. As the only visual generative AI platform trained solely on licensed imagery, Bria safeguards enterprise users from potential legal challenges.
Bria also offers revenue sharing with the source image owner through Bria’s patented attribution mechanism. This technology rewards the owners based on the impact of their contributions, allowing creators to set prices on a per-AI-training-run basis. In the future, Bria’s model will allow other generative platforms to establish revenue sharing arrangements with creators as well.
“We are completely behind Bria’s mission to redefine visual generative AI, focusing on a transparent, responsible, and secure process for developing content while providing enterprises with a stronger value proposition in this field. BRIA’s technology helps businesses avoid the biases and legal landmines that have wounded high-profile organizations attempting to generate AI-based material without knowledge of its origins or without compensating the creators. BRIA’s solution, which only uses licensed datasets, and pays artists for every image used, is the gold-standard generative AI platform for commercial use.”
Jay Eum, Founding Managing Partner at GFT Ventures
Read Reuter’s coverage on Bria’s Series A round here.
GFT Ventures in the Spotlight
Jeff Herbst discusses outlook for OpenAI, Israel Tech Ecosystem on CNBC
Jeff Herbst appeared on CNBC Squawk Box to share his outlook on OpenAI after Sam Altman’s return to the company, the potential impact of Israel-Hamas War on the Israeli tech ecosystem, and what’s next for GFT Ventures.
Among the key discussion points were the primary importance of the talent at OpenAI, as well as the real value of data and computing horsepower behind LLMs. Jeff also shared some insights on Nvidia’s earnings from November 2023 along with the enduring value of the company’s competitive moat. He expressed his huge admiration for the Israeli tech ecosystem despite the recent crises, and why he’s bullish on the future of AI: “We think AI is going to disrupt every application and vertical.”
Watch the full interview here.
Jay Eum featured in SuperReturn Insights e-Magazine
Jay Eum was featured in SuperReturn LP Insights Asia e-Magazine in the “AI: Risks and Opportunities” section where he highlighted GFT Ventures portfolio company Mars Auto as a notable example of AI’s role in autonomous trucking.
Jeff Herbst in Pitchbook’s How-to Guide: Raising Your 1st VC Fund
Jeff Herbst was featured in Pitchbook’s article on how to fundraise for debut funds. He discussed how differentiation is key to launching your inaugural fund, whether it be investment strategy, GP strengths, and / or team with subject mater expertise.
A good way for a first-time manager to determine fund strategy, Herbst said, is to look at their own strengths first. In his case, he previously spent nearly 20 years at AI chipmaker Nvidia as vice president of business development, so it made sense for Palo Alto-based GFT to target frontier technologies including AI and autonomous machines.
Read the full article here.
GFT collaborates with Silicon Valley Bank on AI Roundtable Dinner
At this year’s Consumer Electronics Show, GFT Ventures kicked off a collaboration with SVB to host a series of small / intimate investor dinners focused on topics around investing in AI startups. The first dinner was held on January 12 and included representatives from leading financial and corporate ventures funds with a focus on AI. Topics ranged from the outlook for general and vertically-specific LLMs, ideal profiles for startup investments, as well as risks and uncertainties in the industry.
Jeff Herbst in Modernist Fireside Chat: “Shaping the future of AI — the good, the bad and the ugly”
A Fireside Chat featuring Jeff Herbst was held at The Modernist in SF in December 2023. In this session moderated by Steve Chen, Jeff shared his lessons learned from his twenty-year tenure at Nvidia, including how he helped build Nvidia into an AI and accelerated computing powerhouse.
Jeff Herbst represented GFT Ventures at the RAISE Global Summit
Jeff Herbst spoke on the “Experience Matters” panel at the RAISE Global Summit in October 2023. The RAISE Global Summit is a preeminent industry event that brings together top emerging managers with over 200 LPs. GFT Ventures was selected as one of the 100 emerging funds to participate in the Summit.
GFT Ventures x Women in AI events: GFT Ventures sponsored Women in AI’s AI Panel & Social, Jeff Herbst served as a Judge at Women in AI Startup Pitch Event
In October 2023, GFT Ventures sponsored Women in AI’s AI Panel and Social at The Modernist in SF. The panelist session featured Jeff Herbst, investors from Untethered Ventures and NVIDIA, as well as female founders from early stage AI startups. In February 2024, Jeff Herbst was also invited as a guest judge for the startup pitch event at the Women in AI Lunar New Year Gala.
GFT Ventures co-hosted AI Dinner & Discussion with Stanford GSB Chapter of Singapore
GFT Ventures and Stanford GSB Chapter of Singapore co-hosted "Investing in the Future: Opportunities & Challenges in AI & Frontier Technology" at The Tanglin Club in Singapore in September 2023. The panel session featured Jay Eum and Feng-Ji Sim, Singapore's Deputy Secretary Smart Nation and Digital Government.
We are hiring a new AI-focused Investor
(image generated with Bria.ai)
GFT Ventures is looking for an Investment Senior Associate / Principal who will be an integral part of our deal team. This individual will be involved in all aspects of the investment process, from market research, thesis generation, sourcing, diligence, and deal execution to portfolio support.
We are especially interested in candidates with a strong technical background (substantial training in AI, Data Science or other fields of deep tech) and 3-5 years of experience in highly analytical roles (VC experience preferred).
The job description and application instructions can be found here - please help us spread the word, and we would welcome any referrals from your network!