Trace Cohen
@Trace_Cohen
Exploring... early AI & deep tech | US + Israel | angel in 75+ | Ex-founder, ex-Amex fintech | Columbia MBA | 10M+ monthly Data/SEO views at ValueAddVC dot com
11.4K Following 25.4K Followers
Everyone wants to invest in the startup with the best AI model.
I’m increasingly interested in the company with the best proprietary workflow.
Models will keep getting better, cheaper and more interchangeable.
But if your product is where customers actually do the work every day, you get something much harder to copy:
The data.
The feedback.
The customer relationship.
The distribution.
The model might be the reason someone tries your product.
The workflow is why they stay.
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AI is making it cheaper than ever to build software.
I think that means distribution is getting more valuable, not less.
When everyone can build, building stops being the moat.
The advantage becomes having the audience, customers, brand, data or relationships that let you get the product in front of people.
We’re going to see tiny teams build products that used to require 50 people.
But we’re also going to see thousands of nearly identical products competing for the same customers.
AI is making software abundant.
Distribution is still scarce.
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OpenAI Launches Astra For Law With GPT-6
Cloudflare's Prince: Bots Now Outnumber Humans Online
D-Robotics Raises $400M To Build Chips For Every Robot
OpenAI Projects $278B Cash Burn, Eyes $1.2T Valuation
Watney Raises $80M To Put Robots In Data Centers
OpenAI Discloses Six New Rogue-Agent Incidents
One of the biggest mistakes in venture is confusing a great company with a great investment.
They are not the same thing.
A startup can have an incredible founder, product, growth and market and still be a bad investment if you pay too much.
And an ugly, overlooked company can be an incredible investment if you get in at the right price.
VCs love saying valuation doesn’t matter because the winners get so big.
It matters.
Your job isn’t just to find great companies.
It’s to make money investing in them.
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Foursquare got Bendingspooned!?
What’s Infillion!?
End of an era 🫡
What!? Damn late Friday news cycle…
The best time to raise money is when you don’t need it.
Founders often wait until they have six months of runway left and then suddenly fundraising becomes the most important thing in the company.
That’s when investors have all the leverage.
If the company is growing, you have cash in the bank and you can genuinely say “we don’t need to raise,” the conversation is completely different.
You can walk away from bad terms.
You can wait for the right investor.
You can decide not to raise at all.
Fundraising from desperation is expensive.
Fundraising from strength gives you options.
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Send private anon notes to the Muse team to enable it to read all your WhatsApp pls
Founders are taught to obsess over TAM.
I think timing matters more.
A huge market doesn’t help if customers aren’t ready to buy yet.
Some of the best startup opportunities look small at first because something just changed: AI made the product possible, regulation changed, costs collapsed, or customer behavior shifted.
That’s what I want to understand.
Not just “How big is this market?”
Why does this company need to exist right now?
A great market can wait.
A great timing window usually won’t.
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Wow gpt resets was easiest VCs Ai subsidized intelligence ever
Was nice and now everyone runs out so fast 😅
So BendingSpoons needs to buy a company every quarter right?
To keep their rev growth going
Anyone know the terms!?
And that, folks, is why we led @typesafeai's Series Seed 🔥🔥🔥
Instinct and Muse starting to go layer 2 to semi tech people who follow news and trends.
Usage about to 2x real quick
It’s healthier to just eat butter than to put it on normal bread. Just bite it.
2021 called...
Family offices are clamoring for AI investments
