How Did Menlo Become a Top AI Firm?

Matt Murphy says Menlo became a top AI firm by stacking pieces for years, not by spotting Anthropic on the day of the round. The firm needed a fund that could invest at Anthropic's stage, a prepared thesis for what it was looking for, and a services team that gave a company a reason to pick Menlo. Anthropic showing up, with a team that had created ChatGPT, at what he calls a four-billion-dollar entry, was not enough on its own. The surrounding team supplied the courage, the technical work, and the ability to win the deal.

He treats venture as a team sport. He was highly convinced on Anthropic, and that conviction was still an intuition until Tim Tully, a former chief technology officer, spent real time with Tom Brown on the compute multiplier: why those models could be built at a much lower cost, and why that edge could compound. Tully is the former CTO Murphy describes as coming from about a $20 billion company, and that homework is what let him trust the people read. After more than 25 years in the business, the new work was a group of people who were more productive together than as separate track records. Eleven years of that, with the Anthropic decision as a seminal bet, is what he says put Menlo in the top handful of firms in this AI wave. Miss any of those bricks, he says, and the firm might never have arrived.