1Mby1M AI Investor Forum: Manu Rekhi, Managing Director at Inventus Capital Partners (Part 1)

Manu Rekhi, Managing Director at Inventus Capital Partners, discusses his firm’s AI investment thesis.

Sramana Mitra: Welcome, Manu. Great to have you here.

Manu Rekhi: Well, thank you, Sramana. You’ve been doing this for seventeen years but looks like you haven’t aged a single day.

Sramana Mitra: That’s very nice of you; I’ve aged plenty.

So, Manu, we’ve had Inventus here before, but we haven’t had you. So, if you could introduce yourself a little bit – whatever you want to share with the audience. I know you of course, but it would be a good start. Then we’ll get into investment thesis and so on.

Manu Rekhi: Absolutely. Thank you. We’ve been doing this now for fifteen years at least with the firm. Prior to this, mostly, I was an entrepreneur and operator. I did a couple of startups. I was at Google in the early days, and investing became a part while I was still operating. I then fell into this almost by accident. I said no for five years, and I finally said yes. And it’s been fascinating.

There’s nothing more exciting than spending time with very optimistic founders. Every day is different. It helps my ADHD quite a bit, by having to switch context all the time to be able to help founders. All of our team members have been engineers and have built companies in the past.

We’re founders who have become investors. More than anything else,

we understand the background of what it takes to build something. We call ourselves dream merchants, more than VCs. Somebody has a dream and we’re willing to buy the dream.

Maybe I’ll stop there and then we can get into Q&A.

Sramana Mitra: So, Manu, at the moment in these roundtables, the discussion that we are focusing on, of course, we could talk about all kinds of things, but I think the most contemporary discussion is about AI and what’s happening in AI. There’s lots of confusion, there is lots of trends to discuss.

So, let me start us off with your vision or your perspective on how you are investing in AI. What is the firm’s investment thesis vis-a-vis AI?

Manu Rekhi: Sure. We’ve seen this music play before, whether it was the internet revolution or the cloud, mobile, or social. AI is just one of many trends that have the underpinnings. So, at the end, for enterprise especially, it is about productivity gains. Is it a tool? Is it more for hype? Is it improving productivity? These things take time. We’re in a hype cycle. We’ve seen these hype cycles before. But unlike Blockchain, which was truly a hype cycle, and still, it may make fundamental changes, but the promise wasn’t delivered.

I think with AI, it’s been worked on for more than a few decades, right?

I think this is the culmination of lots of work over many decades. There’s still a lot more to go. So, we’re actually very excited. I think there’s a fundamental productivity shift.

Last year, lots of CIOs and enterprises were making experimental budgets trying to figure out what to do. I think, this year and next, actual budgets are being moved into this; and you’re seeing pretty impressive rise in companies.

So, it won’t just be Jensen Huang and Nvidia making all the money. I think there’ll be lots of companies that will come out in the next few years.

Sramana Mitra: I think the difference between Blockchain and AI is that AI is more akin to the SaaS revolution in that SaaS basically changed the architecture of all business workflows. I think AI is going another rev into the business workflows and changing those workflows creating tremendous productivity gains. I think in due course it’s going to be real automation coming through AI, which is what makes it so attractive.

We kind of know how to invest in business workflows, whether it’s enterprise or mid-market or small business. Investing in businesses that enhance business workflows is something that Silicon Valley knows very well how to do, India knows very well how to do, Europe knows very how well how to do. That general thought process is what’s playing in AI with one exception.

This segment is part 1 in the series : 1Mby1M AI Investor Forum: Manu Rekhi, Managing Director at Inventus Capital Partners
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