1/ New Lux quarterly letter to LPs...
Our theme? Tech, venture, global markets told in...
...Four parables of Four brothers
1 Prometheus
2 Menoetius
3 Epimetheus
4 Atlas
2/ The The Prometheus Promise––is Extending Human Limits what we call extensionalism
technology is not just augmenting our natural senses, but fundamentally extending and transforming them in
3/ From sight, sound, touch, hearing and now…smell.
Technology extends our senses (“extensionalism”) with many Lux family co’ leading the way from
@physical_int + CTRL-Labs + Auris Surgical Robotics (touch)
@EikonTX + @Matterport (sight)
Chromatic (hearing)
@Osmo_Labs (smell)
4/The lever + pulley of antiquity gave way to the steam shovel + excavator
Even the modern state's quest for legibility––what James Scott (Seeing Like a State) saw as drive to make complex systems measurable + manageable––Lux cos extend sensed in sea + space @saildrone @planet
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet 5/ From genetically modified pigs with life-saving organs successfully transplanted into humans in dire need with no alternatives…
…to AI infrastructure with important 2nd order effects underway….
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet 6/
Today's largest Al clusters use around 100,000 Nvidia H100 chips and consume roughly 100 megawatts of power. Next year's clusters will scale to 300,000-500,000 chips requiring nearly a gigawatt of power — about the consumption of a small city.
7/ we see 2 futures emerging
1 Distributed compute can eliminate need for massive monolithic clusters––as per our investment in @togethercompute
2 As industry fixates on bigger data centers + more powerful chips––Apple quietly has showing how to run models directly on devices w/ limited memory
8/ America only has a handful of locations that can provide the gigawatt-scale power these massive clusters will require.
While we're bullish on the seeming resurgence of elemental energy - our rebrand of nuclear––abundant natural gas from the Texas Permian seems a wiser bet.
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet @togethercompute 9/ NYC's emergence as a major Al hub with 20 new unicorns in 2023 and 10 more already in 2024.
BUT…beneath the surface excitement though, we identified critical insights that are grounding our investment approach from the irrationality of the markets
10/ Epimetheus represents the danger of divorcing motivation from consequence. The benefits of the future start with tradeoffs of the present constrained by decisions of the past.
Higher for longer is our posture on the natural cost of capital, regardless of what the Fed does.
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet @togethercompute 11/
We have 4 main strategies for current market:
1 Lux Labs
2 Corporate Spin-offs (globally)
3 Tactical Global Opportunities
4 “Fixware” (aka maintenance) (globally)
12/ While techno-optimists focus on frothy greenshoots, they're missing the industry's further desertification: over 30% of 50,000 private cos are trapped in late-stage limbo while >730 unicorns are trapped in exit-less purgatory, with nearly 50% over 10yrs old + dragging down returns like sea-sinking anchors…
13/ We are particularly excited about Lux Labs
14/ Lux Labs formalizes our nearly twenty-year track record of transitioning breakthrough science from the laboratory to the marketplace.
We have successfully spun out or have been first investors behind de-risked technologies and teams from big tech. Examples include Osmo and Physical Intelligence from Google, Aeva (and another not yet disclosed) from Apple, and Evolutionary Scale from Meta. These unlock value by giving breakthrough teams and technologies the funds, freedom and focused entrepreneurial attention to thrive.
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet @togethercompute 15/
Globally we are particularly excited about Israel + Japan +UK
🇮🇱🇯🇵🇬🇧
@physical_int @EikonTX @Matterport @Osmo_Labs @saildrone @planet @togethercompute 16/
17/ As we look to the remainder of 2024 and beyond, several trends bear watching:
the acceleration of Al capabilities beyond language models into biology, chemistry and physical systems; the growing imperative for domestic manufacturing and supply-chain resilience; the continued convergence of commercial and defense technology; the evolution of experimental science through automation; and finally, the transformation of healthcare through sci-fi breakthroughs like xenotransplantation.
In the end, we return to where we started: compassionately competitive, motivated and mission-driven, helping to write the future, one breakthrough at a time.
We're betting on the impatient optimists who refuse to wait for permission to build the future.
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