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Back to 20VC: You Need $1BN To Do Seed Today: The Untold Truths of Venture | Who Wins and Who Loses in the Next Decade of VC | Why Margin and Price Matter Less in a World of AI with Sameer Dholakia, Bessemer, with Sameer Dholakia.

Do Near-term Gross Margins Matter in AI?

Sameer Dholakia is not worried about gross margins over the next 12 months on a growth-stage check. His hold is five to seven years, so he asks what gross profit can become over that stretch, and why.

A spreadsheet that jumps to 60 or 70 percent in five years has to be defended. He wants the reason, not a hope. Economies of scale matter, and so do share and position. In a lot of the AI businesses he has backed, gross margins at the investment were meaningfully lower than the margins at scale, with a factor of improvement inside 12 to 24 months. He will own up to Legora. He led the round at $1.8 billion, and he is a fan. Harry Stebbings had asked about margins, and the lens Sameer Dholakia uses is the hold period, not the next four quarters.

Transcript

20VC: You Need $1BN To Do Seed Today: The Untold Truths of Venture | Who Wins and Who Loses in the Next Decade of VC | Why Margin and Price Matter Less in a World of AI with Sameer Dholakia, Bessemer ·

The Twenty Minute VC: Venture Capital | Startup Funding | The Pitch

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  1. Why Is AI a Bigger Market Than Oil?Sameer Dholakia says intelligence will be a bigger market than oil. Oil powers machines.
  2. Was the Anthropic Round Bessemer's Lowest-voted Deal?Sameer Dholakia says the Anthropic round was the lowest-voted deal in Bessemer's history for as long as Byron Deeter had been at the firm.
  3. Does Entry Price Still Matter in Venture?Sameer Dholakia says entry price always matters, and about 150 times current revenue was still a price he would pay for Anthropic because the company could…
  4. Is Capital a Moat in AI Markets?Sameer Dholakia believes capital is a moat in AI markets and a signal to the market.
  5. Do You Need a Billion Dollars to Do Seed?Sameer Dholakia does not see how a small seed fund succeeds at the prices coming in for early-stage deals.
  6. Why Do Venture Firms Need to Be Giants or Specialists?Sameer Dholakia says a venture firm has to be a giant global platform or an extreme specialist, because the middle is a hard place to make money.
  7. Does Bessemer Still Want Concentrated Growth Bets?Sameer Dholakia says the numbers in a $4 billion Bessemer growth portfolio are large, and the firm still wants concentrated bets.
  8. What Company Does Bessemer Regret Missing?Sameer Dholakia says the company Bessemer rues missing is Stripe. Bessemer was the developer API venture capital firm, and the firm was not in Stripe.
  9. Can Waymo Become a Trillion-dollar Business?Sameer Dholakia thinks Waymo can become a trillion-dollar business, and ride hailing is not the only market that gets it there.
  10. How Fast Could AI Change Drug Discovery?Sameer Dholakia says the next decade of biology, therapeutics, and drug development can show what would have taken half a century.

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