Hey, I'm Dan! I invest in early-stage startups at Madrona and write a weekly newsletter called the DL

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Three types of AI companies

Intelligent applications are one of Madrona’s core investment themes, and this week Soma and I wrote an article on the three types of intelligent applications that VCs want to invest in.


Overall, whether a company calls their technology “AI,” “machine learning,” or automation, we are looking for companies that can bring 10x improvements to processes and outcomes by being one of these three things:


  1. ⚙️ Automators - Take a well-defined process with manageable complexity and exceptions, and automate it using technology (example: using RPA to automate invoice processing and payment approvals)
  2. 👩‍💻 Augmentors - Take a human-driven process with lots of complexity and use AI to guide, advise, and coach human decision making (example: help people write better marketing copy)
  3. 🤖 Avante-Garde - Use AI to create net new products and workflows that would not be possible without ML technology (example: enable cashierless checkout at different retailers)


If you want more detail and examples of each, check out our full post on Geekwire, and let me know what you think.


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