1Mby1M Virtual Accelerator Investor Forum: With Tim Guleri, Managing Director at Sierra Ventures 2021 (Part 6)

Tim Guleri: Second, we are a hungry partnership. We have a large network of friends in the ecosystem boomerang entrepreneurs to us. We have a young team of investors that are active in the ecosystem by market. For instance, we have a person that is dedicated to the Midwest region to reach out to B2B entrepreneurs.

We have somebody covering Canada and Israel, for example. The way those guys work is, they will partner with the local venture firms and make sure that they know us and we know them. There is a bit of a ground game involved.

The last thing, we have an 80-person strong CIO network. These 80 CIOs are the ones that are consuming services from these early-stage companies. When they see interesting ones, they send us that deal flow.

I was just on the phone yesterday with the head of the cloud at Fidelity. He is one of my good friends. We were talking about what we were seeing in the market. He just rattled off three names of companies that he thought were innovative. Those are the three predominant ways in which entrepreneurs get connected.

Sramana Mitra: What are the trends? How do you synthesize what you see out there right now by way of deal flow or teams that are emerging? What would you like to invest in based on those teams?

Tim Guleri: There are a couple of points there. If you take a step back, one is, we do what I call classic infrastructure investing. This includes the cloud, data, security, SaaS, and transactional-based business models. That is the regular gamut.

On the deep tech side, we have done some interesting companies. Envision AI is one of them. This is AI innovation using cameras and how that applies to different vertical problems. We find that interesting. We have done some blockchain investing. That is of great interest to us.

Vertical SaaS is another one. We think that there is going to be a lot of innovation at the application layer as entrepreneurs build certain layers. Those are some of the broader clusters where we are seeing great companies.

The second one is from a trend standpoint. There is a strong trend in developer-led go-to-market. The developers are the distribution channel. We are seeing a dominant innovation in that stream. The second is API-led.

These are headless infrastructure where there is an API go-to model and there is a cross-connection being developer-led and API-led because APIs are consumed by developers. The API-led market is quite interesting and it is booming in different verticals and also on the horizontal part of the stack. It is exciting.

The third bubble I’d say is the third coming of open source and the related ecosystem. The first coming was when I did Sourcefire in early 2000. The second was after 2008. This was when great companies were invested into. These are some that you see in the market today at scale around Kubernetes.

Sramana Mitra: We talked to a few companies that are doing the API-led PaaS strategy and I think that has produced a lot of interesting companies. I was talking to Unbabel. They are an AI translation technology. They are a team from CMU. They are Portuguese. They are doing 60% of their business on Zendesk.

They are talking to Zendesk through an API and running their technology on top of them. They get a lot of leads out of Zendesk. I am hearing this quite often where there is an API call with a company that has a substantial customer base. 

A lot of leads are coming from those customers because they want to incentivize their exit barriers by integrating with other apps. This is an interesting emerging trend.

Tim Guleri:  Yes, definitely.

Sramana Mitra: Thank you for your time.

This segment is part 6 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Tim Guleri, Managing Director at Sierra Ventures 2021
1 2 3 4 5 6