Ex-Greylock GP Sarah Guo announces partners for Danah, its new AI fund

Venture capital is prone to cycles of hype, like last year’s Web3 funding glut and artificial intelligence in late 2010. Now, AI is back in the zeitgeist, but venture capitalist Sarah Goo is confident the hype here will stay — so much so that she’s betting a fund Its new venture capital is on this bet.

Guo on Tuesday announced the first closing of a $101 million debut fund for its new investment firm Convection Partners. After spending nine years at Greylock, where she rose through the ranks to become Silicon Valley’s second general partner, Guo left the company in June. With Convection, it plans to invest in AI startups up to the first stage of the first phase with check sizes between $1 million and $10 million. Guo started as a solo investor, but plans to build a team around it tailored to the research-heavy nature of AI.

For example, it has hired a visiting researcher to conduct research in artificial intelligence, and says it plans to hire more academics who might build new models and collaborate on ideas with startups it invests in Convection. She said an enterprising company thinks she belongs at home and away Forbes in an interview. She noted that for specialized companies, hiring a team of AI researchers “doesn’t make sense.”

Guo grew up in Wisconsin as the daughter of Chinese immigrants who worked at Bell Labs before becoming tech entrepreneurs. She became immersed in technology as a teenager, and created a website for her parents’ company. After graduating from the University of Pennsylvania, she worked for two years at Casa Systems to start a broadband network and in technology investment banking at Goldman Sachs. She joined Greylock in 2013, and credits the public company for giving her access to investments in areas such as health technology and cryptocurrency.

But it was artificial intelligence that suspended it more than anything else. She says she seriously considered leaving Greylock to start a company with Andrew Ng, co-founder of Google Brain in 2016 (which is also the year she was the name of the thing to me ForbesList 30 under 30 for venture capital. However, like Web3 last year, AI had its own hype cycle that fizzled out once technology and revenue proved it was growing too slowly. “Two very clever investors asked me over dinner in 2018, in a trough of disappointment [about AI]What got me wrong about robots and natural language,” she said. “I shyly admitted that the underlying technology didn’t quite exist.”

Now, the quick recent tech hacks from companies like hugging face And the AI الاستقرار stability It suggests that the pace of research progresses in an exponential curve, says Joe. Instead of a blockchain-based Web3, Guo believes that artificial intelligence will be the key technology for the coming years. She says she left Greylock to invest in this type of technology in keeping with her “classic startup story of wanting to do something really different — often easier to do from scratch.”

Guo says her fund only took 10 weeks to raise, and includes both institutional investors like University Endowments (although she said she couldn’t name names) and about 50 founders and CEOs who excel on AI. She considers herself lucky to have raised the fund during the downturn because it gives her access to higher quality companies at lower inflated prices. “It would be really difficult to start a mutual fund in the height of a bull market,” she says. “Capital was insanely plentiful and this affected the actual quality of the investment and the quality of decision making.”

Conviction Partners are likely to make a maximum of 20 investments in startups that build AI from the ground up. “You have to design a company differently to do this: the talent you hire is different and the challenges to solve in the product are different,” Guo said. For example, these companies will need to spend more on computing costs than current software giants built on infrastructure like Amazon Web Services.

“There are a lot of smart investors that I respect who say, ‘It’s a hammer looking for a nail,’ or ‘No machine learning company I invested in has made money,'” Guo said. Lots of things don’t work until you succeed.”

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