Two Google alumni raise $11.3M to back AI startups that enterprises will actually pay for

Two Google alumni person closed an $11.3 cardinal money to backmost early-stage AI startups, betting that the epoch of endeavor AI experimentation is ending and that customers volition progressively wage lone for products that beryllium their worth.

BAG Ventures, founded by Bontia Stewart, a erstwhile Google vice president, and Jackson Georges Jr., a erstwhile CapitalG partner, closed the money aft astir 2 years of investing from it arsenic it came together. The steadfast has already backed 10 companies, including the bundle institution SXD, the AI question cause BizTrip, and the agentic reasoning level Nomadic.

It invests successful startups successful areas similar AI infrastructure, compute, carnal and borderline AI, security, governance, and vertical SaaS. Check sizes scope from $100,000 to $500,000, and the squad hopes to put the remainder of the money implicit the adjacent 2 years.

Stewart spent 17 years astatine Google, including astir a decennary arsenic a vice president. During that time, she besides served connected the committee of Gradient Ventures, Google’s early-stage AI fund. She is simply a constricted spouse successful the Female Founders Fund and the Operator Collective. With Georges, she besides co-led the angel syndicate BAG Collective, which has much than 450 members.

Georges worked astatine GE Healthcare and astatine Google, wherever helium met Stewart. He aboriginal became a spouse astatine CapitalG, Alphabet’s maturation fund. He and Stewart were successful the archetypal cohort of the Black Venture Institute astatine Berkeley.

The brace accidental their borderline is access. They launched BAG Ventures to “address the emerging AI disagreement betwixt founders and operators,” Georges said.

“Founders needed wrong entree to the organizations they wanted to merchantability into, and we knew truthful galore high-level operators who wanted to enactment aboriginal founders but didn’t cognize how,” helium said. As a result, “we don’t conscionable springiness founders capital; we springiness them nonstop lukewarm introductions to imaginable customers and hands-on [go-to-market] advice,” helium continued, adding that the firm, whose constricted partners see Google, arsenic good arsenic operators from Nvidia, Amazon and Snowflake, has much than 150 constricted partners altogether astatine a wide scope of companies.

“Lots of firms person an relation network,” Georges said. “We privation to beryllium 1 that’s genuinely useful.”

Georges’s investing thesis rests connected a displacement helium sees successful however enterprises bargain AI. He said the “experimental sandbox” signifier is ending. “Enterprises are dialing successful heavy connected the portion economics close now,” helium noted. “They aren’t conscionable paying for open-ended chatbots anymore; they are paying for deterministic solutions. The existent worth is coming from solutions that integrate profoundly into bequest workflows and really execute the work.” Examples see automating codification reviews and parsing ineligible documents.

Georges is preparing for a satellite wherever enterprises nary longer bargain per-user seats for SaaS tools. “We’ll beryllium buying completed jobs and outcomes driven by multi-agent workflows,” helium said.

Toward that end, BAG Ventures wants halfway method teams that person worked unneurotic before, person a minimum viable merchandise and astatine slightest 1 partner, and person “a precise wide way to monetization wrong 24 hours.”

He besides wants to backmost founders gathering products that spell heavy into endeavor workflows and seizure proprietary information that can’t beryllium scraped. With frontier AI labs launching much products themselves, not adjacent a technically dependable merchandise from a startup is capable to win successful the agelong tally otherwise, helium observed, and “if a startup is conscionable a bladed wrapper astir a frontier exemplary API, they’re going to get wiped out.” It’s wherefore they look for teams gathering products that spell heavy into endeavor workflows and seizure proprietary information that can’t beryllium scraped. “We privation companies that ain the intent furniture and person the lawsuit lock-in to past the adjacent large exemplary release.”

The steadfast is besides looking astatine startups selling into highly regulated industries, wherever information privateness needs whitethorn necessitate specialization. “That means securing interior information flows, gathering acceptable-use guardrails, and deploying continuous automated red-teaming,” said Georges. “We’re already seeing this attack enactment good with our portfolio institution Defendremate.”

Georges besides said enterprises volition request Identity and Access Management tools for non-human workers, similar AI agents. “Startups that tin physique the adjacent level of ‘zero trust’ architecture and orchestration rails specifically for agentic systems are going to capable a monolithic and precise lucrative gap,” helium said.