Seed-to-Series A venture capital firm Stellaris Venture Partners, which is currently investing from its second fund of $225 million, is betting big on startups innovating with artificial intelligence technology, said Alok Goyal, a partner at the firm, referring to AI as the “biggest trend of our time”.
“For the first time, we are seeing a world where the capability of machines on most common cognitive tasks is actually higher than humans,” Goyal said in an interaction with Fe, adding that he envisions AI to substantially alter almost everything across domains.
“If you look at the birth of computer networks that happened in the early 80s, it grew like brick over brick. In 1994-95, what we call the internet today began to take shape. It took a decade or two to build the internet, although internal company networks existed for even longer. Same is happening with AI today. AI has existed for a long time, but the compute power, the data, and the sophistication of models didn’t exist in those times,” he said.
Not just Stellaris, investors across the country are pumping money into AI startups, at an early stage. According to data sourced from Tracxn, AI-based startups have raised $6.7 million as seed and pre-seed funding across two rounds, marking a significant increase from the $8.6 million raised by such firms across 10 rounds in 2023.
For Stellaris, Goyal said, there are three big themes to focus on, within the AI industry. “One, we believe that both consumer and business applications will get reimagined through the use of AI. Secondly, we believe that software development as it exists today will be dramatically different. And lastly, we believe that this notion of a product company versus a service company will dramatically alter as well,” he said.
Stellaris has so far invested in companies such as Mamaearth, Whatfix, Propelld, Kiwi, Signzy, Turno, BeepKart, Zouk and more. It typically makes less than 10 investments a year with each cheque between $500,000-$6 million. “We are big believers that we should invest when the world is going very slow, and it’s okay to be slow when the world is going bonkers,” Goyal remarked.
