Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. Hillo, I'm so excited
Speaker 1: to speak to Constantina, and of course it's all about AI.
Speaker 1: He also had a great conversation with Jensen Wango Nvidia. Constantine,
Speaker 1: thank you for joining us. I know and everyone's talking
Speaker 1: about AI. Everyone's talking about also this deal between open
Speaker 1: ai and AMD.
Speaker 2: Your first thoughts, well, it's an exciting new partnership. We
Speaker 2: were with Jensen Huang this morning and the relationship between
Speaker 2: Nvidia and open Ai goes back a long way. In fact,
Speaker 2: we were talking about how their very first AI factory,
Speaker 2: the dgx one, was delivered to open ai back in
Speaker 2: twenty sixteen to Elon Musk actually at the Sequoia offices.
Speaker 2: And so it's just a reminder that all of this
Speaker 2: AI revolution is powered by really impressive hardware.
Speaker 1: You're very focused on agenta AI. We're the biggest opportunities
Speaker 1: and why Agenda AI of.
Speaker 2: Course, so agentic AI is AI that doesn't just make
Speaker 2: a decision, it actually takes an action on it, and
Speaker 2: we are now in the moment where it's really starting
Speaker 2: to make a difference in workflows. I give a couple examples.
Speaker 2: One is actually for a security We're investors in a
Speaker 2: company called Expo that started off trying to find vulnerabilities
Speaker 2: in software and now ranks number one in the world
Speaker 2: on global vulnerability leader boards for finding vulnerabilities and fixing
Speaker 2: them for the good guys. Another example, well, we only
Speaker 2: actually service companies that have shown that it is we're
Speaker 2: finding vulnerabilities on their own platforms. So it's for companies
Speaker 2: that have been approved and gone through the vetting and the.
Speaker 1: Second and you were saying, yeah, the second way to
Speaker 1: do so.
Speaker 2: Another example is our portfolio company, Harvey, which is actually
Speaker 2: helping lawyers to actually complete their work faster. They're now
Speaker 2: at over seven hundred customers and fifty eight countries. But
Speaker 2: just to make it very real, my sister is a
Speaker 2: general counsel at a tech company and she texts me
Speaker 2: a couple of weekends ago and she said, Harvey just
Speaker 2: saved my Friday night And I said, what do you mean.
Speaker 2: She said, well, I got a contract from my CEO.
Speaker 2: Usually it would take three three and a half hours
Speaker 2: to turn it over, used Harvey got it done in
Speaker 2: thirty minutes. And so that's us actually feeling AI and
Speaker 2: agentic KI finishing workflows in the real world, but it
Speaker 2: cost t I.
Speaker 1: Mean, things are getting competitive, right, So how do you
Speaker 1: back the right company?
Speaker 2: So we always look at the team at the end
Speaker 2: of the day, especially for early stage investing. We're looking
Speaker 2: for the founders that are going to endure and persist
Speaker 2: through ups and downs. We know that AI is going
Speaker 2: to have its moments of excitement but also moments of difficulty,
Speaker 2: and we look at the long duration and in long
Speaker 2: duration we think it's undervalued.
Speaker 1: Still, what are the other impacts that actually this could
Speaker 1: have on the economy? But also, you know there's so
Speaker 1: much spence. How are you sure that whatever you spent
Speaker 1: on AI you get the returns in a reasonable time frame.
Speaker 2: Sure. So we're here at the Citial Securities conference with
Speaker 2: a lot of leading investors and they're all talking about
Speaker 2: what's the return on that AI? And that's what twenty
Speaker 2: twenty six is going to be all about. How do
Speaker 2: we actually see that return? And there's a few engines
Speaker 2: that are going to power that. The first is new
Speaker 2: monetization strategies. To date, most of the monetization of AI
Speaker 2: has been subscription revenue, and you pay for a subscription
Speaker 2: and you get a product. Well, there's a couple more
Speaker 2: ways that companies are now monetizing. One is through usage,
Speaker 2: so the more you use the product, the more you pay,
Speaker 2: kind of like a real service. The other is actually
Speaker 2: through e commerce. So last week open ai announced that
Speaker 2: you can actually complete entire purchases on chat GPT, so
Speaker 2: you can actually do research for the product you want
Speaker 2: to buy and buy it through Shopify or ats completely
Speaker 2: on the AI platform. That's something we're excited about. We
Speaker 2: wrote a thesis that this is going to become an
Speaker 2: important way to do commerce, and we believe that will
Speaker 2: continue to be. The other one is new modalities, so
Speaker 2: everybody is used AI for text based modalities. You talk
Speaker 2: to the AI and it responds to you and text.
Speaker 2: We've seen voice hit the mainstream. Voice has gotten so
Speaker 2: good that with companies like Sierra, which is a portfolio
Speaker 2: company that does customer support, you can have entire conversations
Speaker 2: with AI flawlessly, or companies like Listen Labs does market
Speaker 2: research incredibly well with voice. And then in twenty twenty
Speaker 2: six we'll see video start to really take center stage.
Speaker 2: We obviously have seen Sora and Nano Banana and those
Speaker 2: perform incredibly well. It's just the beginning for them.
Speaker 1: Talk to me a little bit about the partnership that
Speaker 1: you have with Citadel Securities. I mean, this was a
Speaker 1: large amount of money from Sequoia and Citadell. Is this
Speaker 1: a blueprint of more of these kind of agreements?
Speaker 2: Of course, So we were the first outside investors in
Speaker 2: Citdel Securities in twenty twenty one. We're proud to have
Speaker 2: invested a billion dollars in the business and a lot
Speaker 2: of the reason we invested in the company was the
Speaker 2: technology platform that they operate on and have built. And
Speaker 2: this technology platform has changed an entire industry. So if
Speaker 2: you think back thirty forty years, the way that securities
Speaker 2: were traded was really in person services. Two people would
Speaker 2: find a price and then transact in person. And they,
Speaker 2: especially Ken, had a vision of the future in which
Speaker 2: you're going to actually be able to discover that price
Speaker 2: using algorithms, predictive algorithms, and then actually be able to
Speaker 2: complete that digitally. And we've actually seen that become the way.
Speaker 2: The vast majority of equities are now traded digitally, and
Speaker 2: it's just the beginning. So only eight percent of fixed
Speaker 2: income is traded digitally. There's another ninety two percent to go,
Speaker 2: we see big expanding markets, and frankly, it also reminds
Speaker 2: us of the AI revolution and the agentic revolution, where
Speaker 2: it starts off manual and then you get AI to
Speaker 2: make a prediction and then like an agent, you actually
Speaker 2: complete it digitally.
Speaker 1: I mean, this is basically an industry being disrupted.
Speaker 2: Right.
Speaker 1: Is there still one industry that we haven't thought about
Speaker 1: that you're looking at, ah that will be significantly disrupted?
Speaker 2: There always is, There always is an industry for disruption,
Speaker 2: but also for innovation. You know, we want to make
Speaker 2: people's lives better. I think an industry that could have
Speaker 2: a lot of innovation that would help everyone is health care.
Speaker 2: Why do I say that, Well, there's a lot of
Speaker 2: spend in healthcare. It's incredibly important, and we're not all
Speaker 2: getting the services that we could. So my wife is
Speaker 2: a surgeon in health care. She has from her health
Speaker 2: system hundreds of patients that could come through and get
Speaker 2: those procedures. She still spends a lot of time writing
Speaker 2: notes and actually doing tasks that an AI can help with.
Speaker 2: In fact, now an AI is helping so her health system.
Speaker 2: She uses open evidence, which is now used by forty
Speaker 2: percent of physicians. She uses a Bridge, which does transcription,
Speaker 2: and that actually helps her complete that busy work faster
Speaker 2: so she can spend more time with patients. I'm very
Speaker 2: hopeful that one of the areas that AI helps with
Speaker 2: is healthcare.
Speaker 1: Constantine, thank you so much for your time today. That's
Speaker 1: Constantine Bluler there from Sequoia.