Felicis, the 16-year-old Bay Area-based early-stage enterprise firm, has a popularity for investing globally. Indeed, firm founder Aydin Senkut — who spent a handful of years at Google as a product manager in its earlier days — was born in Turkey and talks often of the hustle he sees in founders around the globe.
Felicis can also be known for the very strong track record it has established over time, with early bets on some breakout corporations as Notion, Canva, Adyen, Cruise, Flexport, and Shopify, to call only a handful. Still, the firm isn’t content to rest on its laurels, apparently. As a substitute, Senkut and team often appear at — and likewise sometimes sponsor — industry events to which founders flock, and such was the case last week at a StrictlyVC event, which the firm volunteered to anchor as a partner. Thankfully, they’re the perfect sort of partner to have, on condition that each Senkut and partner Viviana Faga, who joined the firm in 2021 from Emergence Capital, happened to have quite a lot of interesting insights to share in regards to the AI corporations that they’re meeting and sometimes competing aggressively to land as portfolio corporations. (Amongst Felicis’s related bets: it has funded the app development company Supabase and the content creation company Runway AI.)
We talked with the 2 in quick chat that you may see at page bottom, and excerpts from which have been edited flippantly below for length and clarity.
We’re hearing every other day about this or that AI research team that’s spinning out of Google or one other big company. These are hot tickets right away. How do you compete with the numerous enterprise firms attempting to nab their attention?
AS: It’s funny, I used to be at Google when there have been only 30 people now there are, like, 200,000 people. So quite a lot of these persons are like family, we all know them. In order that’s one huge advantage. . . We’re also thesis driven, as well, so we attempt to do a very good job of [conveying that] there are particular areas that now we have confidence [and that we think are] really gonna pick up, and we’re educated about [them]. [But] you don’t should be in every AI company to do well. You simply should be in the best ones. I’m just really glad there’s quite a lot of activity [and that] people in AI [are] picking up the startup ecosystem again. For you aspiring founders [in the audience], I hope you discover success ultimately. It’s bringing some positivity back into our ecosystem.
Obviously not everyone seems to be cut out to be a founder. How do you recognize who has what it takes? Social proof?
AS: I hope that we’re not making our decisions just on social proof. There are quite a lot of AI researchers, but a number of the top ones have the very best variety of citations. Then there are research individuals who’ve worked on research that’s rather more broad reaching and rather more critical than others. Once we were working with Runway, they really co-authored [the deep learning model] Stable Diffusion and were arguably one [set] of perhaps 20 people in that area.
[Even still] constructing an organization isn’t a simple thing, so what market you decide could be very necessary. Certainly one of the brutal laws that I’ve learned since I left Google is that you will have to essentially pick your area because should you’re going against incumbents which have amazing distribution, you may give you [something] that’s even 10x higher, however it’s much easier for [that outfit] that has 100 million users to supply an AI feature and charge $1 a month than for a brand new company to give you a superb product. In order that’s where you will have to essentially make a judgment call when it comes to, how critical is that this and does this truly have a probability of carving a distinct segment of its own? That’s why there are various fewer corporations that may rise above that noise.
VF: Back to that time, does a founder know leverage that distribution? [Runway CEO and cofounder] Cris [Valenzuela] was very methodical and now has a partnership with Canva, and with Getty. That is a few of what you will have to search for while you’re backing these AI researchers — have they got that industrial go-to-market mind?
Image Credits: Slava Blazer / TechCrunch
How are these teams capable of compete for talent? Google just laid off quite a lot of people; I’m wondering if that”s impacting anything.
VF: The war for talent is totally brutal. It’s a board level conversation when you will have Google, Meta, etcetera offering $1 million-plus packages. So it really comes right down to finding these folks at an early stage, giving them a big equity package, and hopefully, they imagine within the mission of constructing an iconic category-defining company, right. That’s what has worked for us, however it is incredibly hard right away.
AS: Who you’re employed with also matters. Certainly one of the things I learned by working at Google with [Google’s chief scientist] Jeff Dean, is that the world’s best and smartest people wish to work with the world’s other best and smartest people. So should you start with an A or A+ team [it matters]. There are only so many people who find themselves really well-respected within the industry, and everybody does their research, the identical way they do their research on us. So should you don’t have story, you don’t have a mission and also you don’t have an A+, I don’t think you’re going to have great success.
Viviana, you mentioned go-to-market strategies. Are these much different on the subject of today’s AI corporations versus “traditional” enterprise corporations?
VF: It is sort of different, go-to-market within the AI era versus what it was for the last 10 to twenty years with SaaS. A few things that we speak about quite a bit [as a firm] is speed of iteration. It was that you might launch an online page and launch a few features over a few months and that was enough. Now, AI corporations launch latest features every day, and people are all the time the best-performing features. We talk quite a bit about community, too. Corporations are launched on Discord now; that’s an efficient marketing channel. So yes, it’s quite different, and I believe it’s really exciting. 
Image Credits: Slava Blazer / TechCrunch
You’ve gotten a marketing background and I’ve heard you say before that marketing strategy can change an organization’s trajectory. Out of curiosity, I’m wondering what you make of two very different AI device rollouts that recently captured everyone’s attention: the Humane AI pin, which the corporate teased for months before debuting before a small group of reporters, and the Rabbit R1 device, which rolled out without fanfare in a conference room of a casino during CES.
VF: I saw the Humane launch and I’d love to purchase one . . .You’ve gotten to do something that’s true to you. For Humane, it made perfect sense to accumulate quite a lot of quiet buzz and anticipation. It relies on the market and who a founder is selling to and who the client is. But the perfect products don’t win [automatically]. It’s very easy to repeat. So corporations that look different, act different, and talk in another way to their users are those which can be going to face out and win.
AS: A number of great products follow science fiction. [Humane’s rollout] was one in every of those things. Like, are we gonna have something that’s omnipresent and could be very easy to make use of that you just don’t even consider using and is all the time there? The scary thing about marketing is that sometimes you may do all the things right, and it’d still take some time for the product to take off. But being original, being different — it really matters. Being first doesn’t win, but having essentially the most differentiation makes a difference, and marketing amplifies that positioning.
(Note to readers: our next StrictlyVC evening is coming up Thursday, February 29, in Hollywood, in partnership with Lightspeed Enterprise Partners. If you happen to’d like to affix us for an additional night of drinks, bites, and great conversation, you may still nab a seat here. Note that our recent San Francisco event was sold out, and we expect our L.A. event to sell out as well.)
