The last several months have brought a tremendous rise of opportunities from Generative AI (Gen AI) and Large Language Models (LLMs) applied to the Enterprise and B2B context.

We believe there are two things that are simultaneously true in this space. First, a lot needs to be done to derive actual, consistent value from Gen AI in the enterprise context in a prudent manner. Second, over the coming years and decades, modern AI will help rewire every business workflow, leading to trillions of dollars in value creation.

It has become clear that chat interfaces such as ChatGPT are a great starting point, but by themselves may not be the ideal solution for various use cases in an enterprise setting. A lot of work goes into making Gen AI solutions work for each specific workflow, vertical, and use case. Getting together the right data in the right context, coupled with the right plumbing, integrations, user interfaces, and appropriate security, privacy, and other guard rails in place in a cost-effective manner is non-trivial.

That said, potential applications of modern Generative AI extend across business functions, industry verticals, and use cases. We are on the path to seeing significant changes not only to the underlying software layer but also in how work itself is done by humans working in tandem with smarter machines.

We have seen the best teams move very quickly as the underlying Gen AI tech capabilities evolve, and are starting to see early signs of real value getting delivered in the enterprise.

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Portfolio Activity across Generative AI

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At Emergent, we have been investing in Enterprise AI since 2016 with our core focus on Intelligent Enterprise Software and continue to invest actively in the stack around modern AI and the applications coming out of it.

Some Emergent-backed companies have been using the building blocks of Gen AI for 5+ years to process natural language, images, and media content. We started making Gen AI native investments a couple of years back. Over the past year, many other Emergent companies have begun to leverage LLMs and other transformer and diffusion models to significantly extend their existing ML/AI offerings and enable their customers to have a seamless, end-to-end experience.

Here are some examples of how Emergent portfolio companies are applying the latest in Generative AI across a number of real-world use cases:

Improving the contact center experience: With their new Generative AI suite and a custom LLM tailored for contact centers, Observe.ai is bringing modern AI to the customer interaction process. The Observe team started building and using contact center specific LLMs when they first emerged in 2018, starting with the famous BERT model. Observe has built a 30-billion parameter LLM model tailored to contact center data, and this model is already 35% more accurate than GPT3.5. Observe’s new Generative AI suite helps contact center agents answer customer questions quickly and accurately, generates summaries of customer interactions automatically, and provides agents with real-time feedback on their performance. This ultimately improves customer experience and reduces wait times, while improving call center productivity. (link)

Engaging customers with realistic, personalized celebrity videos: Gan.ai is transforming customer engagement and enhancing conversion rates with AI-generated personalized videos. Gan is a generative AI-native company. Their product can take a single video recording and create millions of versions, each personalized to the viewer’s data. Imagine a famous celebrity addressing you by name: such personalized content can have a profound impact on customers, enhancing their engagement and loyalty. Use cases include product demonstrations, sales pitches, marketing promotion, employee training, customer support, and more. (link)

Managing Creative Operations seamlessly: Rocketium is bringing Generative AI to Creative Operations. Brands and marketers are increasingly harnessing generative AI to create greater volumes of stunning visuals and engaging copy for ads, blogs, and other assets. With that come the challenges of managing all this creative content efficiently. Rocketium automates the creation of drafts, revision of briefs, and brand compliance checks for various types of creative content, including images and videos. Teams can optimize their creative workflows by automating repetitive tasks, leading to increased efficiency. (link)

More comprehensive vulnerability scanning using AI: Astra Security is leveraging AI to emulate the hacker’s mindset and identify business logic vulnerabilities in applications. For example, for scanning a video streaming platform, Astra might generate test cases for verifying the possibility of account sharing, views manipulation, and payment fraud. Traditionally, automated vulnerability scanners have relied on a person to think of test cases, and that approach may be limited by which scenarios a person can think of at that moment. Astra’s new features helps security engineers and customers get creative just like hackers do while finding vulnerabilities in applications. (link)

Writing content that is actually great: Recently, many content writing tools have come up that can enable quick creation of content. However, quality of that content is key to it being useful to its readers, and for the content to be ranked high by search engines and LLMs. With the launch of its new product, ContentAI, Quattr is making it easier than ever for SEO and Marketing teams to write and optimize content. ContentAI is the AI copilot that integrates LLMs the right way into the content and SEO workflows and utilizes real-time factors that affect SEO. (link)

Reducing friction in contract management: Generative AI has promising applications in LegalTech, including contract drafting, legal document summarization, case prediction, and natural language interfaces that provide clients with real-time answers. SimpliContract is using AI to help legal firms automate contract management. (link)

Seamless certifications and course creation: Talview is transforming the hiring landscape with its award-winning Generative AI-powered interview platform. Additionally, their latest Generative AI tool, CertiFast AI helps Customer Education and Learning & Development teams reduce new course creation time from 26 weeks to just 26 days, transforming the way training and adoption programs are done. (link)

Helping B2B products become more customer-centric: As an early adopter of LLMs, SupportLogic has leveraged predictive AI to empower customer-facing teams in extracting and analyzing customer signals for years. They are now introducing new generative AI capabilities, including language translation, case and account summarization, a unified dashboard, and coaching for customer service professionals, further enhancing their value proposition. (link)

Creating high-impact presentations instantaneously: Prezent.ai is the intelligent presentation success platform for enterprise teams. Powered by Generative AI built for enterprise presentations, organizations can 10x presentation productivity and streamline agency spend. For example, provide some context and Prezent can generate on-brand hyper-personalized presentations for you in seconds. Provide a 20-slide deck and Prezent creates a 1-page executive summary. And it can make frankenstein decks brand-compliant with a single click. (link)

Generating personalized PR pitches: Press Hook has launched a GPT-powered pitch generator designed to empower PR professionals in crafting pitches that capture the attention of journalists and yield meaningful results. From initial drafting to personalized customization and pinpointing the right contacts to receive the pitches, this technology streamlines the entire pitching process, setting new standards for PR efficiency and effectiveness. (link)

Infrastructure that enables Generative AI: A tremendous amount of work goes into getting modern AI to work accurately and securely in the enterprise. We are investors in many companies that are making this happen.

• Acceldata’s data observability platform helps enterprises ensure data reliability, allowing them to deploy their AI strategies with confidence. (link)
• Arcion helps replicate enterprise data to lakehouses and warehouses in real-time, a crucial step in building high-performance AI applications. (link)
• Privado’s Privacy Code Scanning AI engine helps privacy engineering, information security, and engineering teams get instantaneous visibility into how software code handles data. It can help track data flowing to third-party hosted LLM providers, vector databases, and ML training platforms, which is a key step towards better AI governance. (link)
• UpTrain is an open-source product that ensures that LLM applications are performing reliably by quantifying their performance on aspects such as correctness, structural integrity, bias, and hallucination. (link)

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Emergent Updates 

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We are actively investing across the pre-seed and seed stages from our Fund 2. We are currently excited about enterprise automation, especially in under-digitized functions and verticals; and Data, Cloud, and LLM infrastructure. Of course, we invest in outstanding founders across the broader Enterprise, B2B SaaS, and Cloud Spaces.

 We are also investing actively from our new Opportunity Fund 2, which participates primarily in post product-market fit rounds of selected breakout companies that we have known and tracked for a while, including companies that we’ve backed since their pre-seed/seed stages. With the massive set of Enterprise AI opportunities ahead, and with valuations for early venture rounds more reasonable now than at any time in the past several years, we are excited about this fund and our ability to continue partnering with winning companies.

Round Table Learning

Emergent has been organizing learning sessions for portfolio company founding teams on key areas such as iterating towards product market fit, building out early go-to-market, and organic customer acquisition. As part of this series, we have seasoned experts in various areas share their experiences with founders in an interactive, small-group setting.

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Financing and M&A

Coverage of selected recent funding rounds and exits in the Emergent portfolio

Acceldata announced a $50M Series C round, led by March Capital and participation from Sanabil Investments, Industry Ventures, Insight Partners and others. Emergent co-led Acceldata’s seed round in 2018. (link). Acceldata also announced recently that it has acquired Bewgle to deepen enterprise data observability for AI and to incorporate leading-edge AI capability into its product. (link)

Lumeus announced $6M in seed financing led by Tola Capital. Emergent led the pre-seed round earlier and participated in the seed round.(link)

Rocketium announced $5.3M in a round led by Tenacity Ventures with participation from existing investors Emergent Ventures and Blume Ventures. Emergent led a prior financing round. (link)

Gan.ai announced $5.25M in financing. Emergent invested alongside Surge and Sequoia Capital India. (link)

Factors.ai announced a $3.6 million Seed round led by Stellaris and participation from existing investors Elevation Capital and Emergent Ventures. (link)

SimpliContract announced a $3.5M pre-Series A round led by Emergent Ventures, with participation from Kalaari Capital, Picus Capital, and others. (link)

Okera announced it had entered into a definitive agreement to be acquired by Databricks for its AI-centric governance capabilities (link)