If there’s one thing that VCs agree on when backing AI startups, it’s that AI requires a different investment approach than prior technological shifts.
“It’s a funky time,” said Aileen Lee, founder and managing partner of Cowboy Ventures, onstage at TechCrunch Disrupt 2025. The longtime VC noted that the rules of investing have significantly shifted now that some AI companies are leaping from “zero to $100 million in revenue in a single year.”
However, Lee also noted that, based on her firm’s research, Series A investors aren’t just seeking rapid revenue growth. “It’s an algorithm with different variables and different coefficients.”
Some of the factors investors now measure, according to Lee, include whether the startup is generating data, the strength of its competitive moat, the founders’ past accomplishments, and the technical depth of the product. “Depending on what your company is, the output of the algorithmic formula is going to be different,” she said.
Jon McNeill, co-founder and CEO of startup creation firm DVx Ventures, stated that even startups that grow rapidly from inception to $5 million in revenue often struggle to secure follow-on funding. “I think this game has changed, and it is changing dynamically,” he said.
McNeill noted that Series A investors are now applying the same rigorous standards to seed-stage startups that they previously reserved for more mature companies.
“I think a lot of investors have figured out that the breakout companies, in most cases, don’t have the best tech,” McNeill said about why Series A VCs are looking so closely at startups’ ability to attract and retain customers. “They have the best go-to market.”
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Steve Jang, founder and managing partner of Kindred Ventures, disagreed that a strong go-to-market (GTM), an industry term for sales and marketing, holds greater weight for investors. “I don’t think it’s 100% true to say mediocre technology, great GTM wins and raises money and gets customers. I think that it’s a necessary requirement to have both.”
While McNeill later clarified that having a solid product is important, he indicated that his initial comment was related to the founders’ need to develop an exceptionally strong sales and marketing strategy right out of the gate. “Investors are getting much more sophisticated on the go-to market than they have in the past,” he said.
(The debate over marketing versus tech was brought to the forefront later during the conference when Roy Lee, founder of the viral startup Cluely, said onstage that launching a product that barely worked, even with massive social media fame, may not always be the best idea.)
Aileen Lee added that AI startups are now under pressure to deliver product updates and new features at an unprecedented pace, preempting existing companies that might try to introduce similar products. “If you look at how much OpenAI and Anthropic are shipping, you’re going to have to figure out how to match how much you ship, how quickly and the quality of it,” she said.
Despite the expectations for breakneck growth and fast product development, panelists agreed that the AI industry is still in its very early stages. As Jang put it, “There are no clear, outright winners, even in LLMs. There are competitors nipping at their heels.”
This means startups still have a path to unseating perceived leaders, whether they are decades-old companies or fast-moving newcomers.
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![Amazon Is Sticking With ‘Rings of Power’ to the End
There’s many uncertainties in this world, but apparently the future of Prime Video’s Lord of the Rings: The Rings of Power may not be one of them. According to a source speaking to The Ankler’s Lesley Goldberg, the show’s considered a “magical halo” by Amazon CEO Jeff Bezos. As such, it’s “proteced for its run” and likely to finish out the five-season arc Amazon pitched back when it first secured the rights. Getting those rights and making the show has been pretty pricey for the company, and the first two seasons had a two-year release gap. At time of writing, the show’s third season doesn’t have a firm date beyond “sometime in 2026,” and some have generally wondered how much more life Rings of Power had left in it. Goldberg’s report also mentions a tradeoff to this five-season plan: for Rings of Power to live on, a spinoff that’d been planned for it has gotten axed. Major Prime Video shows like The Boys and Invincible have become small franchises unto themselves, and it makes sense the streamer would want to repeat that for its remaining big fantasy series. While Amazon may not get to build on Middle-earth after the show ends, Warner Bros. is determined to keep the Lord of the Rings train going with two new films: a Gollum prequel, and an interquel that also reunites the Hobbits after the events of Return of the King. [via IGN] Want more io9 news? Check out when to expect the latest Marvel, Star Wars, and Star Trek releases, what’s next for the DC Universe on film and TV, and everything you need to know about the future of Doctor Who. #Amazon #Sticking #Rings #PowerJ.R.R. Tolkien,Lord of the Rings,Rings of Power Amazon Is Sticking With ‘Rings of Power’ to the End
There’s many uncertainties in this world, but apparently the future of Prime Video’s Lord of the Rings: The Rings of Power may not be one of them. According to a source speaking to The Ankler’s Lesley Goldberg, the show’s considered a “magical halo” by Amazon CEO Jeff Bezos. As such, it’s “proteced for its run” and likely to finish out the five-season arc Amazon pitched back when it first secured the rights. Getting those rights and making the show has been pretty pricey for the company, and the first two seasons had a two-year release gap. At time of writing, the show’s third season doesn’t have a firm date beyond “sometime in 2026,” and some have generally wondered how much more life Rings of Power had left in it. Goldberg’s report also mentions a tradeoff to this five-season plan: for Rings of Power to live on, a spinoff that’d been planned for it has gotten axed. Major Prime Video shows like The Boys and Invincible have become small franchises unto themselves, and it makes sense the streamer would want to repeat that for its remaining big fantasy series. While Amazon may not get to build on Middle-earth after the show ends, Warner Bros. is determined to keep the Lord of the Rings train going with two new films: a Gollum prequel, and an interquel that also reunites the Hobbits after the events of Return of the King. [via IGN] Want more io9 news? Check out when to expect the latest Marvel, Star Wars, and Star Trek releases, what’s next for the DC Universe on film and TV, and everything you need to know about the future of Doctor Who. #Amazon #Sticking #Rings #PowerJ.R.R. Tolkien,Lord of the Rings,Rings of Power](https://gizmodo.com/app/uploads/2026/04/lotr-rings-of-power-hed-1280x853.jpg)
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