1Mby1M Virtual Accelerator AI Investor Forum: With Daniel Cohen, General Partner at Viola Ventures (Part 1)

Daniel Cohen, General Partner at Viola Ventures, discusses his firm’s AI Investment thesis. If you have been following this series, you know that it has yielded a lot of insights.

Sramana Mitra: Today, we’re going to start our session with a conversation with Danny Cohen, General Partner at Viola Ventures. We’ve had at least, I think, one or two conversations already.

This conversation today is going to be focused on AI, which is dominating the popular consciousness in terms of technology. But when we think about it from startups perspective, from investment perspective, from venture capital perspective, the point of view is different. So we are trying to understand what are the possibilities, what are people investing in, what do people want to invest in, and so on. So, Danny, welcome. It’s great to have you back.

Let’s start with some general kind of overview of how you are thinking about AI.

Daniel Cohen: First of all, it’s great to be here again. I remember when you started back in 2008—you haven’t changed a bit.

I think AI is the topic on everyone’s mind right now. Everything and everyone seems to be about AI, and if something isn’t, it feels like it’s not interesting. Every single pitch we hear these days has some sort of AI component.

The good news is that AI is set to revolutionize so many areas—business applications, consumer experiences, infrastructure—just about everything. That’s the exciting part: it’s a huge opportunity for disruption, which often leads to innovation and significant financial opportunities.

But the challenge is figuring out who the winners will be—what’s going to succeed, where to invest, and how to approach it. It’s one of the toughest puzzles I’ve seen in recent years

Sramana Mitra: Now, how do you segment the types of opportunities and which ones of those are you focusing on from your fund?

Daniel Cohen: I think, at this point, the big winners have been the technology players—especially those focused on infrastructure and foundation models. Tons of money has been poured into these areas, and some massive companies have emerged in a remarkably short time. Those who got into foundation models early have either already made significant profits or, at the very least, hold a lot of value on paper.

As for us, our fund is a $250 million fund based in Israel. On one hand, we’re always looking for innovation and technologies with a strong edge. But at this point, it’s tough for us to compete on the infrastructure side.

That’s why we’re focusing all our energy on understanding how AI will transform the application layer. With the immense infrastructure being built by the big tech companies, the key question for us is: How can this be leveraged to create new applications? Essentially, we’re exploring what will change in how we work and live in an AI-driven world.

Sramana Mitra: Yes. So the way I’m thinking about it is these huge platforms with huge infrastructure, and the large language models that are getting the billions of dollars of funding are going to be kind of a platform layer, which we’re going to look at as platform as a service, essentially, and build on top of that. We’ve seen the platform as a service model already for at least a couple of decades, if not more. We understand the platform as a service layer and how to work with it. I think this very heavily funded, very large infrastructure layer is going to operate in that mode. That’s the best mode.

So, when you look at the application layer, what I’m hearing from most people is the dominance of vertical AI as the area of interest in terms of startups and investment. Is that where you are looking as well?

Daniel Cohen: Absolutely, this is our key focus area. The big question to ask—and try to answer—is how AI, as a broad concept, applies to so many different applications and verticals. By definition, these verticals vary greatly in terms of accessibility and opportunity.

Some verticals will be easier to penetrate, while others will prove far more challenging. Interestingly, the larger and more significant verticals tend to be the most complex to navigate, and the real rewards in those areas might only materialize much later.

For us, it’s about identifying where disruption is likely to happen and pinpointing the applications that will drive it. We’ve already funded some of these applications, but you need to evaluate and analyze each vertical on its own.

This segment is part 1 in the series : 1Mby1M Virtual Accelerator AI Investor Forum: With Daniel Cohen, General Partner at Viola Ventures
1 2 3 4 5 6