[ SOUND ] I wanna move on and talk to you a little bit about the climate for investing for start ups for 2017. This year we saw quite a few start up struggle whether it was shifting strategies, lay offs, cutting back after over expanding. Is this a sign of a bigger cloud on the horizon? What's your take? I think that we're Probably midway if not more to that correction, I think what you saw was actually a sign of the ability for start ups to raise money, shifts, right. So, this year it was definitely harder for start ups to raise more capital, whether that was going from a C to the A, you know we've seen studies that say 80 % drop in series A fundings or whatever. But I think that what that shows is so a lot of these companies raised money at high evaluations. These so called unicorns in 2015, 14 or whatever. And then now, still not public, still not cash self sustaining. Needing to make adjustments and figuring out how to live without this free flowing money for more rounds. So I think we're Maybe halfway through that, I think some of that will continue next year. On the other hand, I think there's tons of optimism for interesting new early stage companies, and I know we're gonna talk about some of those trends. So I think for early stage companies, it's still very good. I think these mid late stage companies that aren't quite public. But have raised lots of money at these really high valuations. Those are the ones that get caught short. And that is the area you play in, in the early stage. So do you think that early stage investors are going to be more conservative and really require more signs of. If not profitability at that point. Clear a path to it? I think for sure we've been fortunate that, you know, as always there's sort of There's the, great entrepreneurs will always have choices on who they take money from at any stage, but I do think as early- stage investors, we focus on series A, we're seeing increased progress, increased quality, not only in the teams, but you're right. They wouldn't be profitable in the series A stage, but just more milestones. More customers, more proof points of product market fit. So I think it's becoming a better time to be an investor. So what are some areas that you think will be ripe for opportunity next year? I think there are a couple of trends, some which continue from before. So our firm has been a big investor in cybersecurity since the start. So back to 2014, but for myself, back to 1999 when I entered the venture business. Clearly, well before the DNC hacks, it's for corporate America, frankly probably starting back from the Sony hacks and the Home Depot problems, it's been a massive multimillion dollar opportunity for start- ups. We have some companies like ForeScout and Exabeam, which are in the visibility and analysis forensic space, which are doing really well. I think new areas. We're very interested in what we think of as next generation user interface. So that's everything from voice interface, things like Lexa and Google Home to what's called conversational UI, which looks like text messaging. Hm. And I'm just noticing that on my iPhone now. Yeah. So and so our view is Whether it's the voice interface or the conversational UI, that's gonna be owned by the big platform guys. They're all fighting it out everyone from Google to Amazon to Facebook to Microsoft. But we think the opportunity for start ups is to use artificial intelligence, which was also overused, as a technology behind this interface in connecting back into the existing software systems that are theirs. So whether that's In the enterprise, connecting a conversational UI into your sales force database, which is what Troops. AI, a company here in New York that we recently invested in, does. Or, for consumer use, which is allowing Chatbox to actually be smart and help you with Shopping, which is really around visual search and visual artificial intelligence with a company called mode. ai that we did. We're also beginning to look at artificial intelligence and its use in making the software. We're not gonna do again, the hardware plays are gonna be owned by the big companies. RIght. Software for autonomous vehicles, those are some new emerging areas. Interesting. [ SOUND ] [ BLANK_AUDIO ]

Here’s What the Market for Startups Looks Like for 2017

According to Aspect Ventures’ Thersia Gouw
