JD Vance when she wants to get on top

Table of Contents

• Asks

• The Rundown

• News and Research

• Podcast Episodes, Deep Dives and Projects

• Raises

• Tweets and Posts

• Final Thoughts

Asks

• If you read this newsletter regularly, what have you liked so far, and what have you found helpful? What do you think could be improved?

• Do you have highlights you want to share?

• What suggestions do you have that would make this more compelling?

Please feel free to respond to this email with anything that you think would be useful!

The Rundown

Q2 earnings are on everyone’s mind as the AI race leads to more CapEx for fear of being left behind. The mainstream news has focused on this point, highlighting the lack of meaningful gains in productivity.

For example, Sundar Pichai and Mark Zuckerberg both out in the last 24 hours now explicitly agreeing with my AI Arms Race narrative: That AI CapEx is driven by game theory.

However, outside the brutal numbers coming out of the FAANGs, some companies like ServiceNow are showing that AI can drive bottom-line results when appropriately implemented. Here is what Bill McDermott, the CEO, said on the earnings call:

Our Q2 results prove that we are delivering elite-level execution. Subscription revenue grew 23% year-over-year at constant currency, which is 100 basis points above the high end of our guidance. CRPO grew 22.5% at constant currency, which is 200 basis points above our guidance. Operating margin was over 27%, nearly 250 basis points above our guidance. What's the headline? ServiceNow is relevance is the AI platform for business transformation is soaring. This is a growth company on an unprecedented trajectory. Moving to the topic of AI. Now Assist net new ACV doubled quarter-over-quarter, significantly overachieving our expectations, and it became the fastest-growing new product in the company's history. We signed 11 Now Assist deals with $1 million-plus NNACV in Q2, two of which were over $5 million. We had impressive wins across industries, from banking, healthcare and manufacturing, to semis, tech and many others. As an AI Lighthouse customer, Stellantis is using ServiceNow as its strategic AI platform to manage operations across HR, finance and supply chain. American Honda selected Now Assist as their GenAI solution of choice to improve deflection and efficiency of service, delivering a world-class experience to their employees.

While Bill McDermott looks like Lil’ Baby Billy from the Righteous Gemstones, he nonetheless highlights the importance of reimagining and rethinking workflows with LLMs to boost productivity. It's not enough to create an LLM; one has to create a product or Agent that runs through the steps to create the user's desired end result. Often, a task must run through multiple agents to complete a job. That is why I have been an early and long-time supporter of AgentOps, which orchestrates these interactions. (See here for a deeper dive into Agents.)

Lil’ Baby Billy McDermott

ServiceNow, in comparison to other companies, is at the forefront of how LLMs will be applied and boost productivity. Rather than seeing LLMs as a panacea, the company realizes that it needs to build well-crafted workflows that achieve the user’s end result. That’s why, during the earnings call, McDermott said:

ServiceNow is putting AI to work for people. Our GenAI strategy is focused on infusing intelligence into the flow of work, end-to-end across the enterprise, every department, every persona. With our native integrations, we already help people orchestrate across different systems and data sources. Now we can train the machines to do the low-value work so the people can up-level to the knowledge work.

In other news, JD Vance most certainly didn’t f*ck a couch, but it's definitely funny that it's now a meme. 

News and Research

• Skims and Chime are going public. Skims, co-founded by Kim Kardashian, and fintech company Chime are making preparations for public debuts in 2025. Read in The Information.

• A new influential paper proposes how LLMs can conduct reasoning. the framework that guides large language models (LLMs) during multi-step reasoning by treating the process as a heuristic search problem. Read now in arXiv.

• The SEC has charged BitClout founder Nader Al-Naji with fraud and an unregistered offering of securities. Read in TechCrunch.

• TikTok fueling OpenAI? Microsoft has succeeded in reselling OpenAI’s AI models to cloud customers, generating substantial revenue. Read in The Information.

• Harris is doing better than Biden but that's no sure thing. Nate Silver's latest election forecast model gives Donald Trump a 61.3 percent chance of winning the Electoral College and Kamala Harris a 38.1 percent chance. Read in Newsweek.

• DJT is a Bitcoin maxi? Donald Trump announced a plan for the US government to maintain a national bitcoin stockpile if he is reelected. Read in Wired.

• How did the PayPal Mafia infiltrate the GOP? A small influential network of right-wing techies orchestrated Vance’s rise in Silicon Valley — and then running mate. Read in The Washington Post.

• Have you validated your startup Comedians are now roast start-up founders in Silicon Valley's 'Snark Tank,' blending humor with harsh, but constructive, criticism. Read in The Washington Post.

• How Cryptokitties and SV Billionaires are teaming for Trump. Read in Yahoo Finance.

Podcast Episodes, Deep Dives and Projects

• Check out my new podcast with Ofer Medelevitch, Head of Developer Relations at Vectara.

• Listen to this podcast on Finance and AI and how it’s changing investment research.

• I am conducting a deep dive into the future of SaaS pricing and consumption-based models. Please contact me if you have your own thoughts or would like to contribute.

• Check out my github for current projects.

Raises

• Level AI, a company that offers a suite of AI-powered tools to automate various customer service tasks, raised $39.4 million with the lead investor Adams Street Partners. read here.

• rif t, a company that automates tedious sales work so sales teams can focus on selling, raised $5 million with the lead investor Sequoia Capital. read here.

• Vijil, a company that helps enterprises build and operate AI agents that people can trust by measuring the trustworthiness of AI agents and providing safeguards for their reliable, secure, and safe operation, raised $6 million with the lead investor Mayfield's AIStart seed fund and Gradient Ventures. read here.

• Momentum Labs Inc., a company that offers a platform that taps into sales and customer calls to transform into customer intelligence using artificial intelligence and automation. The platform automatically captures customer intelligence via call recordings, emails, and Slack, turning that data into actionable insights to predict and prevent customer churn, alert revenue leaders of forecast risk, streamline processes, and automate routine tasks, raised $13 million with the lead investor FirstMark Capital. read here.

• Code Metal, a company that specializes in AI-powered development workflows for the edge, raised $16.5 million with the lead investor Shield Capital. read here.

• Chainguard, a company that is the secure foundation for building with open source software. The company's portfolio of secure, minimal container images helps organizations embrace a new culture of software development where starting left with security, not shifting left, is the reality, raised $140 million with the lead investor Redpoint Ventures, Lightspeed Venture Partners, and IVP. read here.

• Gradient AI, a company that is a leading provider of artificial intelligence (AI) solutions for the insurance industry, improving loss ratios and profitability by predicting underwriting and claim risks and reducing quote turnaround times and claim expenses through intelligent automation, raised $56.1 million with the lead investor Centana Growth Partners. read here.

Tweets and Posts

• Someone made with AI a country song about JD Vance fucking a couch.💀🤣🤣

• Bro starting to look like an Albanian from the Bronx.

• If JD Vance had a film career, the term “casting couch” would have a whole new meaning.

Final Thoughts

I have some exciting opportunities on the horizon! Please contact my email, [email protected], since I have more time to speak with people and help where I can. I am still actively angel investing.