What’s 🔥 in Enterprise IT/VC #409

Building a customer-obsessed culture from Inception - lessons from Clay and others...

How do you a build a customer-obsessed technical startup from Inception, especially when it’s just engineers in the early days?

You put your best customer facing engineers in front of customers from the very beginning on the first POCs and technical sales. I know it takes away from engineering roadmap priorities and goals but when Founders close those first deals and work on implementing and creating a successful roll out, they usually do it themselves if technical and perhaps loop in an outward-facing engineer from the team to help.

There is no better way to build user empathy and understanding and a killer product than allowing some of your technical team to have exposure with customers. Over time, companies like Clay and many others even hire engineers to do tech support and even run sales. Yes, it sounds like heresy, but wow, the customer understanding just goes 📈 and the product feedback loop is super strong.

This podcast with Varun Ananad, co-founder of Clay (a boldstart port co - more from my partner Eliot Durbin on the journey to insane 📈 growth), on the magic 🪄 and why it just works. Suffice to say that the growth has been pretty insane doing things that were not traditional on GTM and it recently closed a new round at $500M post.

This week on 1 to 100, Usman Hanif (@usygoosy) sits down with Varun Anand (@vxanand), Co-founder and Head of Operations at 
@clayrunhq. 

Clay is an innovative go-to-market platform that uses AI to help businesses find their target audience, enrich lead data, and automate personalized outreach. 

They also explore how Clay has revolutionized data aggregation, discover technical challenges and strategies for exponential growth, supported unexpected communities and "claygencies" and share the company’s future vision and hiring preferences.

This dovetails nicely with my talk with Paul Salamanca from the Top One Percenter show on why everyone needs to learn how to sell. Listen in!

Full podcast here on Spotify:

As companies grow, one other way to keep the engineers and company finely tuned and aligned with the mission to build amazing products that customers ❤️ and want is to share key recordings of customer prospect calls and support calls internally. There is no better learning platform than listening to what customers love, hate and want. If you’re not doing this today, start now! Embedding this into the culture, particularly with engineers in the early days, gives them a bit more to think about when building especially when they know who it’s for and why!

As always, 🙏🏼 for reading and please share with your friends and colleagues!

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Scaling Startups

#anatomy of a pivot from a once 🔥 AI-native co called Tome which last raised at a $600M valuation on a rumored $2M of ARR for presentation software - smart move by the founder and here’s how they did it

#some advice for emerging managers starting new funds

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Enterprise Tech

#the commoditization of AI models and token costs is 🤯 and building for a hot-swappable model future around agentic workflows is what the best in the biz do

More here…

#🤔 - yes, it’s a trend but not sure to this extend - read comments

#🤯 AI Code assistant space on 🔥 - Codeium (see last week’s post on Gartner MQ) just raised $150M at a $1.25B valuation, just 7 months after its Series B and the stats are impressive 📈 - one of 🔑 to enterprise growth is offering a self-hosted version, hybrid setup and also removes non-permissively licensed code (code under copyright) before training its models (TC)

We are proud because it represents what we have accomplished so far:

* Built what we believe to be the most densely talented team of 80 individuals, on both the engineering and go-to-market sides of the business.

*Grown a free individual user base from nothing to over 700,000 active users in under 2 years, and a paid enterprise product from nothing to eight figures in ARR in less than a year. And the slope is incredible - we have increased our ARR by over 500% since the start of the calendar year.

*Built a truly differentiated product via personalization, availability, extensibility, reasoning, and enterprise readiness. A product that has 5 star ratings across extension marketplaces and is trusted by many Fortune 500 companies to be the best tool for thousands, and even tens of thousands, of their internal developers.

*Researched, developed, and launched technological breakthroughs, such as Cortex, while breaking ground on novel products, such as Forge. And doing this with breakneck velocity, having been the first to GA a number of features seen as standard today, such as in-IDE chat, in-editor command, and context awareness.

#🔥🔥++, and Magic in the AI Code Assistant space also just announced a massive round: “Generative AI coding startup Magic lands $320M investment from Eric Schmidt, Atlassian and other” (TC)

From blog post:

We’ve raised a total of $465M, including a recent investment of $320 million from new investors Eric Schmidt, Jane Street, Sequoia, Atlassian, among others, and existing investors Nat Friedman & Daniel Gross, Elad Gil, and CapitalG.

Join us
Pre-training only goes so far; we believe inference-time compute is the next frontier in AI. Imagine if you could spend $100 and 10 minutes on an issue and reliably get a great pull request for an entire feature. That’s our goal.

To train and serve 100M token context models, we needed to write an entire training and inference stack from scratch (no torch autograd, lots of custom CUDA) and run experiment after experiment on how to stably train our models. Inference-time compute is an equally challenging project.

We are 23 people (+ 8000 H100s) and are hiring more Engineers and Researchers to accelerate our work and deploy upcoming models.

#speaking of Magic - this is 🪄 if true

#There is no AI in the enterprise without AI Security Robust Intelligence bought by Cisco - first AI security startup to go in game of musical chairs - who will build the standalone platform and who becomes a product in a portfolio? (Security Week)

Cisco announced on Monday that it’s in the process of acquiring Robust Intelligence, a California-based company that specializes in securing AI applications.

Financial details of the deal have not been disclosed. Robust Intelligence announced funding rounds totaling $44 million between 2019 and 2021, and Cisco now says it has also invested in the company.

Robust Intelligence has developed an AI application security platform that automates testing for safety and security issues in AI models.

The platform can detect and assess model vulnerabilities, and helps organizations protect their applications against attacks. These validation and protection components can be used together or independently.

#👀 OpenAI weekly active users at 200 million, double from last November (Axios)

By the numbers: OpenAI also said that 92% of Fortune 500 companies are using its products and that usage of its automated API has doubled since the release of GPT-4o mini in July.

#Head of AWS Matt Garman at an internal fireside chat on the future of coding 🤔 (Insider)

"If you go forward 24 months from now, or some amount of time — I can't exactly predict where it is — it's possible that most developers are not coding," said Garman, who became AWS's CEO in June.

"Coding is just kind of like the language that we talk to computers. It's not necessarily the skill in and of itself," the executive said. "The skill in and of itself is like, how do I innovate? How do I go build something that's interesting for my end users to use?"

This means the job of a software developer will change, Garman said.

"It just means that each of us has to get more in tune with what our customers need and what the actual end thing is that we're going to try to go build, because that's going to be more and more of what the work is as opposed to sitting down and actually writing code," he said.

#Cribl continues to execute as it raises $319M at a $3.5B valuation, up 40% from 2 years ago…

from TechCrunch - pretty impressive growth

Cribl’s riding high, claiming to have 25% of the Fortune 500 as clients and annual recurring revenue (ARR) surpassing $100 million. (Cribl says its customer base has grown “triple digits” year-over-year in the last five years, and that ARR has climbed 163% CAGR in each of the past four.) The roughly-700-employee company isn’t yet cash-flow positive, but it aims to be by 2025.

#Platform engineering teams seem to be asking about Backstage IDP (internal developer platform) the most but companies like Cortex and Port are rising fast with their own proprietary versions of an IDP

#great overview of what’s happening in cybersecurity from Cantor

#how big is the CSPM market?

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Markets

#Salesforce reported numbers, super profitable and slow growth which is why it’s all the more important for Benioff to go all-in on AI and his vision is built around agentic workflows vs. task-oriented Co-pilots - worth a listen and I do agree with him

#also love the FUD (fear, uncertainty, and doubt) being thrown at Microsoft from Benioff at Salesforce - agents vs. a copilot for a single task (CNBC)

“This is not copilots,” Benioff said. “So many customers are so disappointed in what they bought from Microsoft, and copilots, because they aren’t getting the accuracy and the responses they want. Microsoft has disappointed so many customers with AI. Listen. These agents are autonomous, able to act with accuracy, come right out of the box, able to go right out of the platform.”

A Microsoft executive pushed back on that description.“Every customer is at a different place in their journey, but overall we are hearing something quite different from our Copilot for Microsoft 365 customers,” corporate vice president Jared Spataro said in a statement provided to CNBC. “Last quarter alone, we saw a customer increase of over 60%, and daily users have more than doubled – a clear indicator of Copilot’s value in the market. When I talk to CIOs directly and if you look at recent third-party data, organizations are betting on Microsoft for their AI transformation.”