Sequoia Partner Konstantine Buhler Talks Agentic AI

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Michelle Hussein 0:00
Hello and welcome. This is The Michelle Hussein Show. I'm Michelle Hussein. I speak with people like Elon Musk. I think I've done enough. And Shonda Rhimes. That's so cute. This will be a place where every weekend you can count on one essential conversation to help make sense of the world. So please join me, listen and subscribe to The Michelle Hussein Show from Bloomberg Weekend, wherever you get your podcasts.
Tim Stenevek 0:27
You certainly ask interesting questions.
Unknown 0:32
Bloomberg Audio Studios. Podcasts. Radio. News.
Francine Lacqua 0:38
Hello. I'm so excited to speak to Konstantin. And of course, it's all about AI. He also had a great conversation with Jensen Huang of NVIDIA. Konstantin, thank you for joining us.
Konstantine Buhler 0:47
Thank you, Francine.
Francine Lacqua 0:48
Everyone's talking about AI. Everyone's talking about also this deal between open AI and AMD. Your first thoughts?
Konstantine Buhler 0:55
Well, it's an exciting new partnership. We were with Jensen Huang this morning, and the relationship between NVIDIA and OpenAI goes back a long way. In fact, we were talking about how their very first AI factory, the DGX1, was delivered to OpenAI back in 2016 to Elon Musk actually at the Sequoia offices. And so it's just a reminder that all of this AI revolution is powered by really impressive hardware.
Francine Lacqua 1:21
You're very focused on agentic AI. Where are the biggest opportunities and why agentic AI?
Konstantine Buhler 1:26
Of course, so agentic AI is AI that doesn't just make a decision, it actually takes an action on it. And we are now in the moment where it's really starting to make a difference in workflows. I'll give a couple examples. One is actually for AI security. We're investors in a company called Expo that started off trying to find vulnerabilities in software and now ranks number one in the world on global vulnerability leaderboards for finding vulnerabilities and fixing them for the good guys. Another example.
Francine Lacqua 1:56
How do you know it's the good guys?
Konstantine Buhler 1:58
Well, we only actually service companies that have shown that we're finding vulnerabilities on their own platforms. So it's for companies that have been approved and gone through the vetting.
Francine Lacqua 2:09
And the second, and you were saying the second way to do it?
Konstantine Buhler 2:12
So another example is our portfolio company, Harvey, which is actually helping lawyers to actually complete their work faster. They're now at over 700 customers in 58 countries. But just to make it very real, my sister is a general counsel at a tech company, and she texted me a couple weekends ago, and she said, Harvey just saved my Friday night. And I said, what do you mean? She said, well, I got a contract from my CEO. Usually it would take three, three and a half hours to turn it over. Used Harvey, got it done in 30 minutes. And so that's us actually feeling AI and agentic AI finishing workflows in the real world.
Francine Lacqua 2:51
But, Konstantin, I mean, things are getting competitive, right?

What is the significance of the AMD and OpenAI partnership?

Francine Lacqua 2:54
So how do you back the right company?
Konstantine Buhler 2:56
So we always look at the team at the end of the day, especially for early stage investing. We're looking for the founders that are going to endure and persist through ups and downs. And we know that AI is going to have its moments of excitement, but also moments of difficulty. And we look at the long duration and in long duration, we think it's undervalued still.
Francine Lacqua 3:17
What are the other impacts that actually this could have on the economy? But also, you know, there's so much spent. How are you sure that whatever you spend on AI, you get the returns in a reasonable timeframe?
Konstantine Buhler 3:28
Sure, so we're here at the Citadel Securities Conference with a lot of leading investors, and they're all talking about what's the return on that AI, and that's what 2026 is gonna be all about. How do we actually see that return? And there's a few engines that are gonna power that. The first is new monetization strategies. To date, most of the monetization of AI has been subscription revenue. You pay for a subscription and you get a product. Well, there's a couple more ways that companies are now monetizing. One is through usage. So the more you use the product, the more you pay, kind of like a real service. The other is actually through e-commerce.

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