December 2, 2023

pioneer charles hudson Want to be cautious but not too cautious. The venture capitalist, who attended an AI conference last month, has yet to make new AI investments in the current hype cycle.

He’s one of many investors who see inflection points take over an industry, bringing with them massive amounts of capital, new founders, and sometimes FOMO-driven snap deals. Historically, Hudson doesn’t mind sitting out. “For cryptocurrencies, for example, I think it’s almost zero,” he said. “I don’t think I can accept zero as the answer for AI. The question is where and how.”

While the “ChatGPT for X” companies are indeed interesting, Hudson said he’s not paying attention to them for now because they’re just “wrapper” companies splicing together different existing companies. “I may regret it, but I guess I’ll just say that my imagination didn’t provide the answers.” He said a founder recently pitched him an exciting product, but when asked what others needed When asked how long it would take to build the same tool, the entrepreneur said “two weeks”.

Hudson’s interest in cryptocurrencies mirrors what’s going on inside every generalist company right now: Are VCs backing new startups, letting their existing portfolios lead them toward AI, or through seemingly magical Pivot, either through a shared love and validation for low-flying AI companies in space?

For example, Jason Lemkin said he has yet to invest in a pure AI startup. “I’m not sure if there was a rush, but I could be wrong,” he said. Most investors’ portfolio companies are adding AI components to their businesses. Then there’s Cathy Guo at Sapphire, who invests in late-stage startups, allowing her time to make investment decisions. In a recent talk, she described an “arms race” between large companies launching massive products and startups integrating AI to differentiate themselves.