C2V Mar 2021 Notes from the Trenches

Welcome friends!  A year later, with vaccinations accelerating and the end hopefully in sight, we thought we’d look back at our earlier Covid content and see how we did. But first, a quick look at our newest investment.

Portfolio Spotlight: Armilla AI

Our newest investment, Armilla is an AI governance platform that tests models for inherent bias and identifies the root causes of any such biases.  Findings are presented via a simple UI that is customized to fit industry audit templates and is tailored for use by both non-technical compliance officers and developers.  

Organizations in several industries are increasingly grappling with reputational risks from deploying AI models that have not been sufficiently tested, as well as lost ROI due to R&D initiatives deemed too risky to deploy, and at the same time, AI models continue to grow in complexity and volume. Additionally, model validation is predominantly a manual exercise today and unable to keep up with the complexity of current development processes. 

Armilla’s platform allows models to be tested in a matter of hours, vetting both the models themselves and the underlying datasets.  Their software automatically profiles models for performance, accuracy, feature importance, fairness, and bias, as well as the impact of test, training and production data on model outputs.  Armilla is also able to continuously monitor ongoing performance, accuracy and algorithmic accountability by detecting errors, drifts, changes and anomalies in production models, and presents its findings in pre-built formats consistent with industry audit templates with which both non-technical compliance analysts and regulators are already familiar.  

Armilla’s initial target market is the financial industry, as it is among the most experienced sectors in using predictive algorithms and is also by far the most heavily regulated, with AI-model bias already a major pain point, both reputational and financial.

Covid Content Review

Since this is a time of optimism, we’ll go from our highest to lowest grades:

  1. 5 Reasons Now is a Great Time to Buy Equities (and Venture Capital Funds) - Published March 17, 2020

Forgive Matt’s victory lap here, but this really is an all-timer and there’s roughly a 0% chance he ever nails a prediction like this again. 

The morning we published this post, the NASDAQ Composite opened at 6,905, a mere 0.6% above its lowest close of the pandemic and 4.0% above its intraday low, both of which came only 4 trading days later.  If anyone tells you they’ve bottom-ticked a market selloff more closely than that, they’re definitely lying. 

Since then, the NASDAQ is up a staggering 93.7% (as of Monday’s close), and while it’s too early to know whether Matt’s prediction will pan out for venture funds, judging by recent private and IPO valuations, we feel pretty good about that as well. 

Here’s hoping you took Matt’s advice and are now sipping champagne on your new yacht.

Grade: A+

  1. What Does a Post-COVID-19 Early Stage Venture World Look Like?- Published June 17, 2020

While any venture prediction realistically needs 3 - 5 years to fully play out, early returns on many of Chris’s prognostications look good.  Among them:

The rise of streaming OTT content, video conferencing and home fitness. 

Check out the stock charts for Netflix, Zoom and Peloton, as well as the number of new streaming service launches and home fitness exits

“Funding has been and will continue to be available…The investor community is alive and well, and… we expect to see some excellent companies get funded post this period.”  

Likewise for venture funding and IPOs (including SPACs) over the past 9 months

“Automation will finally truly have its day in the sun.”

The recent spate of SaaS IPOs certainly seems to be supportive of this and we’re seeing the same in our portfolio, with sales of software and robotics solutions continuing to accelerate.

Grade: A-

  1. 5 Lessons From the Lockdown - Published April 20, 2020

While Matt is still cringing from the realization that he wrote a wrap piece 2 months into what will likely end up being an 18-month pandemic (you have to admire his optimism, though?), his lessons still look pretty good:

1. It Can Happen Here

2. Data and Transparency Are Critical

3. Uncertainty is Always Worse Than Bad News

4. Don’t Politicize Everything

5. Do Not Spread Misinformation

Of course, the “Bonus Lesson” is a nice example of just how much he jumped the gun on this one:

Bonus Lesson: Carole Baskin is a Historically Horrific Human Being

Anyone even remember who Carole Baskin is at this point? 

Content Grade: B+

Timing Grade: F-

Portfolio Companies in the News

Peloton just announced its December acquisition of our home fitness company Otari.

Our electric mobility company, Tarfrom, who is currently raising a Series A round to begin delivering electric motorcycles against a 12-month+ pre-order book, was recently featured in Men's Journal and in a New York 1 TV spot (in which you can see some footage of their Luna model in action).  

Beam, our DTC wellness company launched Elevate, their new hydration product line, which was featured in Maxim and is now available on Amazon in addition to Beam’s webstore.  

Our airline revenue management software company, Kambr, recently signed its 5th airline, AirAsia, a Top 50 global carrier. 

Portfolio Company Job Openings

Following their recently closed Series A round that we led, and which includes professional athletes (and Beam product enthusiasts) Baker Mayfield, Danica Patricka and Billy Horschel, Beam is hiring for a number of positions.  

Roles and details are below and you can also email Beam directly at people@beamtlc.com.

Director of Accounting

Web Developer

Data Analyst

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