1Mby1M Virtual Accelerator AI Investor Forum: With Benjamin Narasin, Founder and General Partner at Tenacity Venture Capital (Part 1)

Benjamin Narasin, Founder and General Partner at Tenacity Venture Capital, discusses his AI investment point of view.

Sramana Mitra: Today, we have the pleasure of welcoming Benjamin Narasin, founder and general partner of Tenacity Venture Capital. Ben has been here before, so you may be familiar with him. We’re launching a new series, and I’ve invited Ben back to share his thoughts and analysis on the AI investment landscape, both from an investor’s perspective and with insights for entrepreneurs. Ben, welcome back!

Benjamin Narasin: Nice to be back. Thanks for having me.

Sramana Mitra: So, Ben, how are you parsing this trend of AI dominating popular consciousness?

Benjamin Narasin: Well, it took me several months to make my first generative AI investment. I made my first AI investment years ago during the early rise of neural networks and machine learning. Interestingly, neural networks were originally developed in the 1960s for AI but were discredited and thought to be ineffective. Now, with the computing power we have, they’re finally viable. Large Language Models (LLMs), for example, have become possible because of this leap in computing capacity, making them the new standard for sophisticated AI that can reach Turing test levels.

It took me a while to get comfortable with this trend. I spent 18 months meeting regularly with a founder who sold an early AI company to Google, discussing the philosophy of building a moat and the long-term value of data. I’m not a thesis-based investor per se, but for such a massive shift, I wanted to have a clear point of view.

Sramana Mitra: You’ve to have a point of view to play around.

Benjamin Narasin: The analogy I use is, when the car was invented, there were 2,000 car companies in the US. The question is, who will be the Ford? Someone in automotive investing told me Germany had 2,000 car companies too; that’s why the Audi logo has four circles—it’s a merger of four companies. This happens with new technology; there’s a rush of players. The challenge is figuring out which ones have a high chance of success.

After 18 months, I ended up making three generative AI investments this year. While I’ve evaluated a broad range of AI opportunities, the biggest, most exciting opportunities are in generative AI. Exciting trends tend to attract the brightest entrepreneurs, so it’s rare now to find a brilliant, driven entrepreneur not focused on some aspect of AI.

Sramana Mitra: Let’s double click down into your three generative AI investments. What drew you to these specific startups, why you chose to invest in them, and what do they say about broader trends?

Benjamin Narasin: Sure. One of my early decisions was to avoid investing in the foundational technology, the LLMs themselves. I wasn’t going to put money into OpenAI or similar companies with multibillion-dollar valuations. Although, a few years ago, I advised some LPs to consider it, and hopefully, they did well with that counsel.

The toughest category to invest in is what I call the “ChatGPT wrappers”—those using existing LLMs and layering value on top of them. The challenge here is protection. If you can’t protect the technology itself, you need to find another way. My first investment is close to this model.

The company is called Maestro, based in Seattle. They’re building an all-knowing chief of staff for organizations. Multiple companies are attempting this, but they seem to have the best approach. The recommendation came from a founder in my personal portfolio, someone I’ve funded twice. He said, “This is what I’d be working on if I weren’t running my current, successful company.” He tested several similar products, and Maestro was the standout.

What I like about Maestro’s vision is that as a company grows beyond a certain size, leaders lose visibility into the granular workings of the organization. After about 10 people, you can’t know everything happening, and past a certain point, you might not even know all your team members. Maestro’s technology gives founders, CEOs, and managers the insights they had when their team was small, making it applicable to any company with over 10 people—a huge market. So I’m excited about Maestro; it’s early days, but they show a lot of promise.

This segment is part 1 in the series : 1Mby1M Virtual Accelerator AI Investor Forum: With Benjamin Narasin, Founder and General Partner at Tenacity Venture Capital
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