Even Benchmark thinks AI is eroding the venture pact against backing rivals
Benchmark says the Valley’s rule against backing rivals is getting harder to keep.
TL;DR
- The traditional venture capital rule of not backing competing companies is under pressure due to the AI boom.
- High-profile disputes, like the one between Factory and Cognition, highlight the increasing conflicts.
- Venture capital partners acknowledge that companies evolve quickly, leading to portfolio companies expanding into rivals' territories.
- Benchmark emphasizes the importance of transparency and maintaining founder trust even when conflicts arise.
- The speed of AI development and founders' ambition are accelerating the trend of overlapping market areas.