By: Brian Wallace and Alex Houghtalin
Over the past five decades, technology has driven immense value creation across every economic sector. Roughly every ten years, we’ve witnessed a “platform shift” as a new foundational technology emerges, transforming how people work. Each technological wave has reinvented or established entire categories and produced the next generation of influential companies.
Source: JP Morgan, “Artificial intelligence: Powering the next wave of technological innovation.” https://am.jpmorgan.com/us/en/asset-management/adv/insights/portfolio-insights/equity/artificial-intelligence-powering-the-next-wave-of-technological-innovation/
Access Venture Partners was founded in 1999, just as the internet bubble reached its peak. We learned hard lessons alongside the rest of the industry that inform the way we invest to this day, emphasizing discipline, fundamentals, and continuous analysis to understand where value will accrue.
As we’ve invested across subsequent technology waves, we’ve carefully considered where to play, making bets in both the application layer and the infrastructure software layer – the tooling that empowers developers to build better software efficiently and securely. In our Build theme, we have avoided capital-intensive or commoditizing areas like cloud infrastructure, instead focusing on software platforms and tools that enhance developer productivity (Rally Software), bring efficiency to data transfer and storage (NextGen Storage), enable data exchange from disparate sources (Cloud Elements), unlock discovery and connections of data and imagery (AlchemyAPI) and improve remote productivity (Dizzion), to name a few.
The current AI wave may be the most transformative yet, and our long history positions us well to identify companies building long-term sustainable differentiation. While we remain focused on investing in the new AI-powered capabilities and business models forming at the application layer (see our Enable and Secure themes), we’re also closely monitoring how AI is reshaping software development itself. Key areas we’re tracking include:
- LLM Developer Platforms: While AI talent is growing quickly, it is still quite scarce. Not only does developing with AI require new discrete skills, but it also requires teams to adopt entirely new processes to scale development. Similar to the way agile development platforms emerged in the early cloud era, a new class of development platforms is needed. Early players include Freeplay, here in Boulder, Humanloop, and Gradient.
- AI-Assisted Development: AI tools are expanding beyond code assistants to optimize the entire development workflow – from automating requirements (e.g., Userdoc generating user stories from descriptions) and testing (Qualiti out of Salt Lake City), to next-gen DevOps platforms automating infrastructure provisioning (Boulder’s Nitric). These boost productivity and accelerate development cycles.
- AI Agents and BI Platforms: A variety of new tools are needed to leverage LLMs, such as those analyzing the origin and path of data to verify the accuracy, veracity and lack of bias and tools, and those protecting proprietary data and preventing commingling with public LLM models. We also are deploying capital in no-code/low-code platforms that can perform analysis on large datasets and prepare complex comparisons and reports, providing incredible efficiency in business intelligence tools and capabilities. An example of that is in our portfolio company Freedev.ai.
With each wave, we’ve seen exponential productivity gains. It’s hard to imagine, but AI has the potential to dwarf prior advancements. We are at the genesis of what will be a fundamental shift in human work and social interaction. At Access Venture Partners, we have always backed founders who are exploiting shifts in underlying technologies to reimagine security and enablement solutions and are excited by the promise of this next AI wave. If you’re a founder building in any of these spaces, reach out! We’d love to chat about how we can help you change the world for the better.
