What’s 🔥 in Enterprise IT/VC #463
Dot.com vibes and the AI house of cards or just the beginning 📈 - celebrating Cognition's insane growth and efficiency
This tweet about Oracle and OpenAI sums up the past week and is proof perhaps we are living in the Matrix.
Meanwhile, the job market feels like a glitch. AI writes the resumes, AI reads them, and still no one gets hired. If we’re still just in the early stages of what AI can do, what will this look like in 5 years?
Let’s dive deeper into Oracle. Look at these projections that Oracle shared with The Street. This looks like a classic, hockey stick 🏒 startup revenue chart except we’re talking in the tens of billions of dollars here! It turns out $300M of that RPO was a five year deal with OpenAI to the tune of an annual $60M per year.
BTW, this wasn’t that long ago, probably 18-24 months at most!
You also have to give Larry a ton of credit as he was once left for dead and now back in the race for AI infrastructure (FT).
The big question is where will OpenAI get the money to pay for this? You guessed it - lots of these dollars will have to come from venture capitalists and their LPs.
If both Oracle and OpenAI deliver on this contract, I can surely say that would mean AI growth stays on rocket fuel 📈, and the money spigot keeps gushing 💰. If not, we may be staring at an AI house of cards.
Some folks are even claiming peak bubble now.
But even on a historical basis, we are nowhere close to dot.com speculation. While Oracle trades at a 48 forward P/E today which was last seen during the dot.com era, it’s nowhere close to the 150 P/E it had back then. We’re still so early in this market, and while we will experience a few mini-corrections, in the long run, AI will deliver insane amounts of value.
While Oracle and OpenAI’s $300B contract dominated headlines, what’s more important IMO is to celebrate Cognition. It’s a story of incredible growth with incredible efficiency! Cognition’s Devin agent ARR grew from $1M to $73M in 9 months with a total net burn of < $20M in its entire history!!! Those are some economics to be excited about.
When you add in Windsurf acquisition, ARR more than doubled and led to $10.2B valuation. Swyx shares a couple other key nuggets:
That one stat - average successful Devin implementation sees 5x growth and a $1.5M/yr customer expanded >10x in 8 months 🤯.
While Oracle’s market cap surge feels like a simulation, the real benchmark for founders should be Cognition; insane growth paired with capital efficiency.
As always, 🙏🏼 for reading and please share with your friends and colleagues!
Scaling Startups
#full YC Summer 25 list is up and great to see what’s trending out in the valley - here’s a screenshot of just a few in dev/eng/product/security - 👇🏼 click for full list
#I find myself sharing this chart with founders - not perfect but good benchmarking for equity frants sof early employees includes data through first half 2025, courtesy of Peter Walker - Carta
#so good and many times I find that also with PhDs, the poor, hungry and determined!
#💯
#the long slog is even longer…14 years to an IPO, back when I started investing it was 5-7 years - so many reasons but still, the journey is only getting longer
#how to do remote even though in office is the strong preference…
#tired of this 9-9-6 nonsense, start with the mission, do what it takes to get it done, startups are a long marathon with a series of mini sprints and some walking between - let’s stop talking about how much we work, just get the work done - rant over - balance also matters
Enterprise Tech
#want to be worth $100B and raise a $1B Series K? You need performance like this:
#first inkling of what Mira building with a $2B Inception round - more determinism/consistency from models
#great overview of productivity tools 👇🏼
#this is bubble like behavior - when only in it for the money, I saw this behavior in the dot.com cycle and it didn’t end well for large majority of cos
#💯
#why you need @HypernativeLabs (a portfolio co) real-time security to protect your crypto assets and transactions
#Jaguar Land Rover still in a world of hurt post cyber attack…
#amazing launch in a crowded tough space, your Cofounder - personal business assistant/agent, 👇🏻 click below to watch video
#on AI adoption…
#some insane numbers for CapX
#access to capital is a moat
#want AI to uplevel your Excel game? Claude wins…
#celebrating milestones - congrats Front on hitting the $100M ARR mark, proud investor from the initial round!
#rounds for AI coding coming fast and furious, inception round at $550M and now 6 months later new round at up to $5.5B 🤯
#Sign of the times 👇🏼 which is why you’re going to need spec-driven development - more in that next week…
Markets
#great to see VCs trying out new models of investing
#🤯
“An extraordinary $332bn in bookings in Oracle’s Q1 represents not only the biggest bookings number we’ve ever seen in software, but a fundamental shift in the business model towards data centre operator,” said Keith Weiss, an analyst at Morgan Stanley. (FT)