1Mby1M Virtual Accelerator Investor Forum: With Christopher Mirabile, Senior Managing Director at Launchpad Venture Group (Part 4)

Sramana Mitra: Let’s talk about what you’re seeing in your deal flow as well as in your portfolio in terms of interesting trends. Early-stage deal flow is indicative of what’s happening in the pipeline of technology and interesting developments. What are you seeing? What’s interesting?

Christopher Mirabile: Asset prices are stupid right now. That’s difficult because doing the kind of investing you and I do, you have to be disciplined about price and about staging capital. Those are difficult circumstances. I feel like there’s a lot of hype about crypto. We’re not paying much attention to that. I’m sure that’s going to be an important technology down the road, but that’s not the focus for us.

We’re seeing very good opportunities in the health and life sciences right now. In tech, there isn’t a well-defined locomotive right this second. We’re in a time where it’s blocking and tackling. The really big companies are just so dominant that it’s harder for little startups to get in and change standards.

There are a lot of marginal and incremental improvements. We have basic things we have to solve like cyber security. I think 5G will be a bit of a locomotive once it’s widely deployed but we’re not seeing one unifying tech trend right now. We’re seeing a lot of incremental improvements across a lot of things. We also feel that certain categories like MarTech are getting tired.

Sramana Mitra: MarTech is very crowded.

Christopher Mirabile: You find a little product-market fit and you make a little bit of a difference. Then the tool loses its effectiveness in six months. We’re being really thoughtful before we commit money in the AdTech/MarTech space. We’re spending more time on problems that are buried deep in industries.

For example, we’re working with a company that’s focused on one aspect of operations in the self-storage market. That’s a market that’s growing steadily, but it’s also invaded by some big companies and private equity. We do a lot of med device and diagnostics healthcare IT. We look at anything and it doesn’t have to be sexy or consumer-oriented.

Sramana Mitra: To your comment about locomotive, the theme that we see constantly is artificial intelligence and machine learning. That applied to a lot of small problems is a viable way to build businesses where there is domain knowledge in some esoteric space.

Christopher Mirabile: You’re right to a point. It’s not an end in itself. There’s a tremendous hype around what basically boils down to statistics and decision-making. A lot of what’s called AI and ML is nonsense. It’s just looking at a medium-sized dataset and making an informed decision. I think that AI is a little bit like a website in 1994. Now every business is on the web. AI and ML are really headed towards being ubiquitous.

For most applications where being 90% correct is good enough, it’s a valuable business tool. I agree with you that it’s an accelerant. It’s a way that a challenger can leapfrog incumbents. In businesses where 90% isn’t correct enough and you have to build fresh AI with a fresh dataset from bare metal, that is not an angel’s game.

Sramana Mitra: That is true. We have a big coverage on AI. We see a lot of companies come. Very recently, I saw a company called Aisera. They’re not only doing AI-driven customer support, they can actually take over the screenshare of the customer’s computer and fix whatever needs to be fixed. That is impressive. That is not an angel game.

Christopher Mirabile: One of the things that I talk about to illustrate your point is that most startups’ biggest competition is inertia. To break into a market like that, you have to be 10x better, faster, cheaper. AI and ML can be enabling tools to leap from the incumbents. An entrepreneur who’s just handwaving AI, you have to dig in a little further than that.

Sramana Mitra: There are companies that are not real AI. They’re just buzzword AI. Thank you for your time.

This segment is part 4 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Christopher Mirabile, Senior Managing Director at Launchpad Venture Group
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