Felicis, 16 years old An early-stage venture firm based in the Bay Area with a reputation for global investments. In fact, the company's founder Aydin Senkut (who spent several years as a product manager in Google's early days) was born in Turkey and often talks about the hustle and bustle he sees among founders around the world.
Felicis is also known for a very strong track record established over time, having made early bets on several breakout companies including Notion, Canva, Adyen, Cruise, Flexport, and Shopify, to name a few. I did. Still, the company apparently isn't resting on its laurels. In return, Senkut and his team frequently appear and sponsor industry events that bring together founders. His StrictlyVC event last week was no different, with the company volunteering to anchor it as a partner. Thankfully, both Senkut and partner Viviana Faga, who joined the firm from Emergence Capital in 2021, have plenty of interesting insights to share about the AI companies they happen to be meeting with. Considering that, they are the best partners. At times, we may compete aggressively to establish ourselves as a portfolio company. (Felicis' related bets include funding app developer Supabase and content creation company Runway AI.)
We spoke with the two in a quick chat at the bottom of this post. Excerpts have been lightly edited below for length and clarity.
Every day we hear news about one or another AI research team spun out from Google or other large companies. These are hot tickets right now. How do you compete with the many venture companies vying for their attention?
AS: It's funny, when I was at Google, we only had 30 people, and now we have like 200,000 people. So a lot of these people are like family and we know them. This is one of the big advantages. . . We're also paper-driven, so we try to do a really good job. [conveying that] There are areas in which we are confident [and that we think are] We're really going to start, and we're being educated about [them]. [But] You don't need to be part of every AI company to be successful. You need to choose the correct one.I'm really happy that there are various activities. [and that] AI people [are] Let's revisit the startup ecosystem.To all ambitious founders [in the audience], I hope that it will be successful in some way. It is bringing positivity back into our ecosystem.
Obviously, not everyone is cut out to be a founder. How do you know who has what you need? Social proof?
AS: I hope people don't make decisions based solely on social proof. There are many AI researchers, but some of the top researchers are among the most cited. And some researchers have undertaken far more extensive and far more critical research than others.When we were working with Runway, they actually co-wrote [the deep learning model] Stable spread and definitely one [set] There were probably about 20 people in the area.
[Even still] Starting a company is not easy. Therefore, which market you choose is very important. One of the cruel laws I've learned since leaving Google is that you need to be very selective about your field. Because to compete against incumbents with incredible distribution power, you can come up with things like: [something] This is even 10x better, but easier [that outfit] Rather than a new company developing a great product, 100 million users can provide AI capabilities and charge $1 a month. So you really have to make a judgment call on how important this is and whether this really has the potential to carve out its own niche. That's why far fewer companies are able to rise above the noise.
VF: Getting back to that point, do founders know how to leverage that distribution? [Runway CEO and co-founder] Chris [Valenzuela] is extremely methodical and currently has partnerships with Canva and Getty. These are some of the things we have to keep in mind when supporting these AI researchers. Do they have commercial market development ideas?
Image credits: Slava Blazer/TechCrunch
How can these teams compete for talent? Google just fired a lot of people. I wonder if that has any influence.
VF: The competition for talent is truly brutal. If Google, Meta, etc. are offering his $1 million+ package, this will be a board-level conversation. So what's really important is that you find these people early on, give them a large equity package, and, hopefully, believe in the mission of building an iconic, category-defining company, right? That's what worked for us, but it's incredibly difficult at the moment.
AS: Who you work with is also important. One of the things I learned working with you at Google is that [Google’s chief scientist] Jeff Dean says that the best and smartest people in the world want to work with the best and smartest people in the world. So if you start with an A or A+ team; [it matters]. There are only a few people in the industry who are truly respected and we study them the same way everyone studies us. So if you don't have a great story, if you don't have a mission, if you don't have an A+ team, I don't think you'll have much success.
Viviana, you mentioned go-to-market strategy. Are there any significant differences when it comes to today's AI companies and “traditional” enterprise companies?
VF: Going to market in the AI era is very different from going to market for SaaS in the last 10 to 20 years.some things we often talk about [as a firm] The speed of repetition. In the past, it was enough to get a web page up and running a few features over the course of a few months. Today, AI companies are announcing new features every day, and these are always the best-performing features. We also talk a lot about community. The company is now launched on his Discord. It is an effective marketing channel. Yes, it's totally different and I think it's really exciting. 
Image credits: Slava Blazer/TechCrunch
You have a background in marketing, and you've said before that a good marketing strategy can change the trajectory of a company. Out of curiosity, what does he think about the deployment of two completely different AI devices that have recently attracted everyone's attention? One is the Humane Ai Pin, which the company has been teasing for months before debuting in front of a small group of reporters, and the Rabbit R1 device that has been rolled out. During CES, he went out with a lot of noise in a casino conference room.
VF: I saw Humane go on sale and I'd love to buy it. . .You have to do what is true to yourself. For Humane, quiet buzz and building anticipation made perfect sense. It depends on the market and who the founder sells to and who becomes the buyer.But the best product doesn't always win [automatically]. It's very easy to copy. So companies that look different, act different, and talk to their users differently will stand out and win.
AS: A lot of great products follow science fiction. [Humane’s rollout] was one of them. For example, are you going to build something that's so ubiquitous and so easy to use that it's always there even if you don't want to use it? The scary thing about marketing is that you can do everything right, but your product won't catch on. It may still take some time to do so. But being original and different is really important. Being first doesn't necessarily mean winning, but maximizing differentiation makes the difference, and marketing strengthens that positioning.
(Note to readers: The next StrictlyVC night will be held in Hollywood on Thursday, February 29th, in partnership with Lightspeed Venture Partners. If you're looking for another night of drinks, snacks, and good conversation, don't miss out! You can enjoy your seat here! The recent San Francisco event sold out and we expect the Los Angeles event to do the same.)