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Firm and Portfolio Updates March 2024

Inner Loop Capital is a pre-seed and seed venture capital fund investing at the frontier of Digital Infrastructure and AI. Inner Loop’s thesis is that the $600B+ Digital Infrastructure sector (Cybersecurity, Cloud Tech, and Data Science) is being simultaneously accelerated and disrupted by AI. Inner Loop is based in Baltimore, and the current portfolio spans from San Francisco to Israel. Inner Loop is currently investing out of a $30m-target Fund II. Inner Loop Capital is a solo-VC firm managed by Justin Label.

A Moment of Reflection

Baltimore and the whole country awoke Tuesday morning March 26th to shocking news of the collapse of the Francis Scott Key Bridge. This possibility had been uncontemplated by most residents of the region. Our thoughts are with the six road construction workers lost in the disaster and their bereaved families.

We also pause to recognize the quick thinking and actions of the local pilot, the harbor workers, and the Maryland Transportation Authority Police, whose immediate actions to close the bridge to traffic undoubtedly saved numerous lives, with what seems to have been only seconds to spare. As audio from the event shows, transportation police were also preparing to put themselves in harm’s way for the sake of the construction crew, but ran out of time to do so.

Most everyone who receives this letter works like I do. We are working from wherever suits us to best balance our professional, personal, and family lives. We are working exclusively in the information space – with ideas and OKRs, contracts and bank balances. As COVID did four years ago, the Key Bridge collapse has highlighted the contributions of essential workers, who are working day and night, often in difficult and dangerous settings. The ongoing, exponential advancement of technology and the American economy is possible only because of their commitment as well.

In the wake of this tragedy, we pause again to recognize the contributions of these essential workers. We commit to raising the visibility, dignity, and safety of their work, beginning with the hundreds of people now doing the daunting and again dangerous work to clear the Patapsco River channel and begin the process of recovery and rebuilding.

Firm and Community Updates

The big Inner Loop news in March is the public launch of portfolio company Leen. Leen’s founders have lived what so many security developers and users know – an unreasonable amount of time and security risk lies in the integration between security products. Leen’s Unified Data API for Cybersecurity – a shared data fabric for security products and operations alike – simplifies all security integrations and data sharing. Our lead investor Pramod Gosavi at 11.2 Capital calls it “Plaid for Security”, and I couldn’t say it any better myself. (By the way, Pramod’s LinkedIn is a must-follow for security insights, wry observations, and original memes.)

We are thrilled and honored to join co-founders Neel Arora, Kabir Mathur, and Akash Bhat on this journey, and to co-invest with our new friend Pramod, make a first co-investment with fellow Coolwater GP Farooq Abbasi of Preface Ventures, and have an official collaboration with Oort founder (now Cisco executive) Matt Caulfield. (Matt is separately responsible for connecting us with Jason Hines of Gigasheet!)

Congrats Neel, Kabir, and Akash! More from the company on their launch is here.

In March, I had the pleasure of attending the GCVI Summit, making contact with dozens of new corporate VCs. Inner Loop’s investment thesis about Digital Infrastructure that supports the AI Platform shift resonated with CVCs from semiconductors to industrial firms to financial services. These CVCs expressed interest in a number of our companies and could be good downstream financial and commercialization partners for our portfolio. Also, the venue wasn’t bad, featuring the oldest golf course west of the Mississippi.

I am particularly excited to return to California next week as a guest at the Coolwater Demo Day for Cohort 9 in San Francisco. As I have mentioned in these pages before, the Coolwater community (which has been called the YCombinator of Emerging Manager VCs) has been very important to me since I went through as a member of Cohort 3 in the fall of 2021. As a solo VC, the fellow GPs I have connected with through Coolwater have become some of my most trusted sources of advice, dealflow, and sanity! All of this is only possible because of the vision and endless energy of Coolwater founder Winter Mead and his intrepid team. Thank you Coolwater!

Advanced planning for the RSA Cybersecurity Conference in San Francisco is in full swing. Inner Loop is hosting events at RSA both Monday May 6 and Tuesday May 7. Although our capacity is tightly limited at both events, if you are available and have not already heard from us about the events, please reach out. We will make every effort to get you included. In addition, I have several available slots to meet during the days of May 6-8. Please ping me, and I’d be thrilled to grab a coffee, meet on the show floor, or conspire to crash one of the best parties together.


Portfolio and Industry News

Portfolio News

The Inner Loop Portfolio celebrated some major operational milestones in March!

Gigasheet celebrated adding their 100,000th user! Gigasheet was founded with a modern big data back-end so that their intuitive front-end could give the experience of using a spreadsheet with up to one billion rows. Now they are 0.01% of their way toward one billion users! Onward, Jason, Garth, Erik and team!

Tamnoon’s Managed Cloud Detection and Response platform has successfully resolved over 1,000,000 alerts for users, showcasing the efficacy of their purpose-built technology and AI-driven approach in streamlining cloud security operations and accelerating incident resolution. Congratulations to the Tamnoon team for their continued commitment to empowering companies to fortify their cloud security posture effectively.

Inner Loop portfolio companies are also being recognized for leadership in AI:

Steady provided guidance on leveraging generative AI within digital teams, emphasizing its role in enhancing productivity while cautioning against overreliance on its accuracy and critical thinking capabilities. Henry Poydar’s article underscores the importance of drawing the line at decision-making and critical thinking, highlighting the invaluable role of human reasoning in driving originality and strategic insights within digital product development.

Canoe Intelligence continues its streak of success by winning the ‘Artificial Intelligence (AI) Application (US)’ category at The WealthBriefing WealthTech Americas Awards 2024, marking its second consecutive year as a recipient. Congratulations to the Canoe team on this well-deserved recognition, further validating their position as leaders in AI-driven financial technology solutions.

Our portfolio companies announced several important product and commercial partnerships this month:

Craft announced a strategic partnership with Strider Technologies to enhance supply chain resilience by integrating comprehensive foreign affiliation data, providing organizations with vital insights to safeguard against rising foreign influence threats within global supply networks.

Gigasheet‘s partnership with RevenueBase marks a significant advancement in B2B sales intelligence enrichment, enabling sales and marketing professionals to effortlessly enhance lead lists with over 25 data points, including email addresses, phone numbers, and LinkedIn profiles, revolutionizing the landscape with unprecedented efficiency and accessibility.

xType‘s partnership with NewRocket aims to revolutionize ServiceNow solutions, accelerating project delivery and driving unparalleled efficiency and effectiveness within the ServiceNow ecosystem, ultimately enhancing customer satisfaction and success.

Finally, Tamnoon‘s CEO, Marina Segal, is out with a new video explaining that now is the right time to disrupt the cloud security remediation industry. She cites the exponential growth in CSPM and CNAPP spaces, the growing necessity of cloud protection, and the pressing need to reduce time spent on remediation and investigation phases.

Ad Interim Addendum – Insights on the AI Platform Shift

Battery Ventures, through insights from Dharmesh Thakker, highlights the significant impact of AI on the tech industry, emphasizing its transformative potential in automating human intelligence and revolutionizing traditional business processes. As AI becomes increasingly integrated across sectors, it not only enhances productivity in tech and sales but also paves the way for a rising wave of software innovation, with the potential to unlock substantial economic value and reshape the competitive landscape among leading tech giants.

NVIDIA has pursued a significant increase in venture activity, tripling its investments in about three dozen startups across various sectors in just one year. It is clear that NVIDIA views its ecosystem development as a core competitive advantage. Thomvest’s Umesh Padval (and my former Bessemer colleague) offers insights into NVIDIA’s investment strategy

Other Industry News

Redpoint’s State of the Venture Landscape report indicates signs of stabilization for enterprise software companies since the 2021 peaks, with high-growth software firms gradually rebounding, while AI companies stand out with faster growth rates and higher capital demands. As Series B and C activity gains momentum and historical patterns suggest a possible bottom, Redpoint signals cautious optimism about the near-term future of the venture landscape.

Asaf Horesh, Managing Partner at Vintage Investment Partners, provided a comprehensive overview of the current venture market landscape, highlighting the cyclical nature of capital trends from the COVID-driven tech boom to the subsequent funding dip in 2023. His insights suggest stabilization in VC and startup investments, drawing parallels with historical patterns such as the dot-com era, and emphasizing the importance of disciplined investment strategies amidst market fluctuations.

Finally we’ll end on a Pramod Gosavi (11.2 Capital, our new Leen co-investor) special. Pramod speaks to Security Founders here, but this is just how I feel each day, navigating our investment opportunities in “AI for Infrastructure Software and Infrastructure Software for AI”. Thanks for nailing the zeitgeist, Pramod!


Archives and Please Be In Touch

Archives for both the Firm and Fund Updates (twice per quarter) and Ad Interim: Provisional Thoughts on AI (once per quarter) are available from the Inner Loop Capital website. Please visit innerloopcap.com/news to get caught up.

Now that you are up-to-date on all Inner Loop activities, please reach out any time. I welcome:

  • Discussions about any of the companies, technology sectors, or investment themes above
  • Introductions to founders or future founders in Digital Infrastructure, including Cybersecurity, Cloud Tech, DevOps, DevTools, Data Science, and AI
  • Connections to potential co-investors or collaborators in these sectors
  • And drop-ins to Baltimore (or the greater Washington D.C., area) any time

Do not hesitate to reach out if you see something or have ideas on ways we can collaborate more closely.

Justin Label
Managing Director
Inner Loop Capital

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