We are excited to kick off 2024 with much more enthusiasm from both entrepreneurs and venture investors than we saw last year; it has been fascinating to see new inventions emerging faster than ever in the future of work.
That said, we remain very disciplined because it takes time for a new and enduring paradigm to emerge. Based on our own experience, each time a new mega-technology has broken into public consciousness — such as what we saw at the dawn of the Internet — there is a lot of initial excitement and euphoria, with seemingly limitless opportunities abound, which often results in a lot of recklessness and failed attempts at capturing lasting value and returns. The emergence of AI in the workplace is creating significant opportunities and many failures, and the challenge we all face lies in determining one from the other.
In the “What Keeps Us Up at Night” portion of this newsletter, we’ll dive a bit deeper into some of the most significant risk segments for both employees and investors in this space, as well as some tips on navigating and mitigating this risk. We hope you find our advice valuable and helpful in making 2024 a fantastic year for you!
David, Emily, and Sergio
The Roble Ventures Team
Lens Into a Human-Enabled Future
THOUGHT LEADERSHIP HIGHLIGHTS
Our inaugural Annual Update meeting in the second week of January saw a record number of attendees from the Friends of Roble community:
Thank you again to all who attended. We have so many more exciting announcements to come in 2024, with our trailblazing founders on their way to delivering great returns again. If you are interested in watching the recording of this event to learn more about us and these expected returns, please email emily@robleventures.com.
The Latest From Our Founders
PORTFOLIO NEWS AND UPDATES
Hyperbound has pivoted from an email marketing startup to upskilling sales teams with AI given the needs of their customers; their roleplay platform now turns ICP descriptions into interactive AI agents in less than 20 minutes, and the response from the sales community has been encouraging, to say the least:
If you are interested in trying Hyperbound to train and upskill your sales teams, please reach out to founder Sriharsha Guduguntla at founders@hyperbound.ai.
Teachy was selected as one of the top 100 promising edtechs in LATAM by HolonIQ. Teachy has had tremendous success in helping 30k teachers in Brazil save 10 hours per week with class preparation, grading, and feedback. They are exploring bringing this tool to U.S. teachers, so anyone who might be interested in using Teachy to save time on lesson planning and classroom management should contact founder Pedro Siciliano at pedro@teachy.com.br.
Tiny Comet recently launched its first educational history game, Nation Survival, just in time for the holidays. It was soon recognized as one of the top 10 new best games on Roblox. Founders Emily Tierney and Anca Agapi were also featured in a Pocket Gamer article on the creation of their studio and their experience with the a16z SPEEDRUN accelerator program.
“Our core belief is that play is our brain’s favorite way of learning. We can enhance engagement, excitement, and overall effectiveness by approaching education with a playful mindset.”
Rising Team just celebrated their inaugural company offsite in Santa Cruz!
What Keeps Us Up at Night
KEY RISK FACTORS
By Sergio Monsalve
Through our research and in many discussions with our community, two topics are critical to think about when assessing the true potential of 2024’s most promising companies:
1. The strategy behind a Board of Directors’ creation and composition, especially for seed-stage startups looking to constitute their first official board. A more diverse board — not just in terms of identity but also of background and experience — bodes better than a homogenous (read: all-VC) board.
2. How to avoid areas of the market with “zombie” companies — which essentially means companies that have raised a lot of venture capital at a significant valuation, yet still burn substantial amounts of money. Hence, their prospects of “growing into their high valuation” are bleak; they must drastically cut burn to elongate their runway or raise financing at a down round, which affects all stakeholders involved.
There are fundamental analyses and actions one can take to understand the “level of exposure”:
- These dreaded “zombie zones” occur when current performance is below the valuation set by the last round, especially as a new normal emerges with more depressed valuations. If debt or liquidation preferences are excessive, any new investor will want the cap table cleaned up or will simply walk away.
- Overly compromised balance sheets are bad when the market turns (e.g. too many liquidation preferences and debt are damaging). This happens when the company has grown at all costs, disregarding the principles of “smart growth.”
- We help entrepreneurs avoid these areas of the market by focusing on cutting costs appropriately to deliver intelligent and ROI-based investments. We also advise our companies to avoid taking on debt or raising too much preferred capital (e.g. accumulating liquidation preferences).
In both of these areas, we see entrepreneurs and investors alike making some critical mistakes, which concerns us. This is why we’ll be doubling our efforts to create comprehensive market roadmaps with “watch-outs” and crucial caveats when mapping out the future of work.
We have also developed a proprietary playbook for our entrepreneurs on creating and running a well-functioning board of directors. The key recommendations in that playbook include:
1. How and when to choose an independent board director that adds to the board dynamic,
2. How to establish the a healthy and effective board culture, and how to run the board meeting properly,
3. Aligning board vision, mission, and expectations appropriately, and
4. How to avoid a common CEO pitfall: confusing shareholder rights/votes with board rights/votes.
If you'd like to learn more about how we approach our partnerships with early-stage companies, reach out to us or fill out our pitch form linked below.
What Caught Our Attention
NEWS AND RESOURCES
The more workers use AI, the more they worry about job security (CNBC)
How to Use ChatGPT as a Copilot for Learning (Every)
Labor Department wants to get more gig workers on company payrolls (Marketplace)
How Generative AI Will Change Sales (HBR)
Gen Z and the Art of Incentivized Self-Actualization (WIRED)
How AI Impacts Online Learning (Forbes, via LinkedIn)
AI to disrupt 40% of all jobs (LinkedIn News)
Startups vs Incumbents in the AI Era (NFX)
Is GenAI’s Impact on Productivity Overblown? (HBR)
Are you a founder currently raising in the future of work space, or know someone who is? Pitch us.
About the author
Roble Ventures is a future-of-work focused fund investing in technologies that enable people, teams, and organizations to achieve their most ambitious work.
