AI Meets VC

What Every Emerging VC Needs to Understand About the AI Revolution

July 23, 2025

In partnership with

💬 From Our Team

AI is transforming how investors discover, evaluate, and back startups. From algorithmic deal sourcing to automated due diligence, VC firms are embedding AI into their core. Staying on top of AI is no longer optional; it’s how we, as emerging investors, can get a leg up.

Inside the Real Ways AI Is Powering Venture Capital

🔍 Deal‑Sourcing 2.0

Firms are increasingly using AI tools to sift through thousands of pitch decks and public datasets. Startups previously flying under the radar are now caught by bots. That said, founders need to optimize data presence, structured metrics, consistent online profiles, and clear traction signals are key.

🧠 AI‑Powered Due Diligence

The days of sifting through decks manually for hours are gone. AI is now an active partner in due diligence analyzing everything from founder sentiment during interviews to product-market fit signals based on industry trends, customer feedback, and economic forecasts. Results in faster, more confident investment decisions, and earlier conviction in companies that might have been overlooked using traditional filters.

🗣️ AI for Investor Relations: LP Communications

VC investor relations teams are using AI to personalize LP updates, draft reports faster, and surface key insights without the usual manual lift. Tools can now tailor communications by LP type, track engagement (who opens what and when), and even answer common questions using internal GPTs trained on fund data. Resulting in faster updates, deeper transparency, and more time for strategic relationship building.

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Your AI idea deserves more than just another LinkedIn post.

🚩Three Red Flags AI Still Has in VC and Why You Should Be Careful

1. Bias in, bias out

AI tools trained on past success patterns often reinforce existing biases, favoring founders who look, speak, or build like those who’ve already raised capital.

Why it matters: You might overlook nontraditional or underrepresented founders with real potential.

2. Overreliance on “founder sentiment” tools

Some firms use AI to analyze tone or facial expressions in pitch meetings. These tools can misread nervousness, cultural differences, or neurodivergent behavior as red flags.

Why it matters: Charisma ≠ capability. Don’t confuse performance with potential.

3. AI hallucinations and misinformation

Generative AI can confidently produce inaccurate or made-up data, financial projections, or founder background info. If a VC firm relies too heavily on AI-generated summaries or reports without verifying sources, bad decisions can follow.

Why it matters: You could misjudge a startup, mislead an LP, or base a major decision on false info.

❗Bottom Line: AI is powerful and important but not perfect. Use it to boost your insight, not replace your judgment.

📈 AI investments are on the rise

AI drove 53% of all global VC funding in the first half of 2025, accounting for 64% of US VC dollars (Axios).

🚀 AI Deal Spotlight: Thinking Machines Lab Raises $2 B Seed Round

Mira Murati, former CTO of OpenAI, launched Thinking Machines Lab in early 2025. Thinking Machines Lab is developing a next-generation multimodal AI system designed to understand and interact through text, images, video, and audio essentially creating more “natural,” collaborative AI that feels less like a chatbot and more like a thinking partner. The team includes top researchers from OpenAI, Google DeepMind, and Mistral, and aims to push AI toward advanced human-AI collaboration across industries.

In mid‑July, the startup closed an astounding $2 billion seed round led by Andreessen Horowitz with participation from NVIDIA, AMD, Cisco, Jane Street, and others. This round values the company at approximately $12 billion, positioning it among the largest seed-stage deals ever.

Lessons from this deal:

  • Founder pedigree turns into capital: Murati’s reputation and prior leadership at OpenAI were enough to command unprecedented early-stage funding.

  • Confidence in potential vs. product: The raise came before any public product release, signaling that investors are wagering on technical strength and vision over proven traction.

  • AI momentum ignites mega‑rounds: Thinking Machines joins a trend of massive early-stage AI investments driving the sector forward.

👷‍♀️ Job Board

💕 GIVC update

Girls Into VC Summer 2025 Fellowship Session 6 Recap

We were incredibly honored to host Lily Toto, a Senior Associate at Two Lanterns Capital. Lily shared insights from her diverse journey to venture capital. Here are two major takeaways from Lily's in depth discussion with our fellows:

1. The Power of Early Startup Experience: Lily's journey into venture capital was far from linear. Going to college, she actually didn’t have much prior knowledge on venture capital at all. Starting with economics and government in college, she explored banking and law, but it was her hands-on experience at pre-seed startups during her undergrad years that truly introduced her to what it is like working in early-stage companies. Looking back, she believes that it was her experience working in these startups that best prepared her for investor roles. She emphasized that working on the operational side of a startup, even in part-time internships or fellowships, provides an understanding of the challenges and opportunities founders face. She noted that developing this perspective gives an individual the skill in identifying “red flags or green flags" and fosters crucial "founder empathy" when evaluating potential investments. For undergrads, seeking out these early-stage startup experiences is a big advantage.

2. Strategic Networking in VC:

  • Checking in with people without an immediate "ask": Building genuine relationships means offering help and being friendly, not just transactional.

  • Be deliberate about the events you attend: Attending events aligned with your interests and leveraging platforms like LinkedIn and X to connect with relevant industry players.

  • Specific to women in VC: Lily encouraged cold-reaching out to female partners, as many are keen to mentor junior women in the field.

🎤 Hear From Our Fellows

“Being able to participate in the GIVC Summer Fellowship has broadened my overall understanding of the world of Venture Capital and has provided me with unparalleled advice from industry professionals. I have loved getting to know other women interested or currently pursuing a career in VC. My overall confidence in terminology and cold outreach has grown significantly, which has already helped me to expand my network. I’m really looking forward to the upcoming projects and speakers!” - Taylor Hardner

🧺 In NYC? Come to our picnic this weekend!

🌟 Final Thoughts

AI is becoming the operating system of modern venture capital. From how we source founders to how we build conviction and communicate with LPs, AI is reshaping every part of the investment process.

If you want to thrive in this space, learning AI is no longer optional. It’s how you gain an edge, ask better questions, and spot what others miss.

Where to start:

  • For beginners: Try Intro to AI for Business on Coursera, or explore OpenAI’s ChatGPT prompt guide.

  • For analysts: Play with Perplexity.ai for research, or use Notion AI to summarize founder calls and deal notes.

  • For builders: Experiment with tools like Dust or LangChain to see how LLMs are powering custom VC workflows.

You don’t need to be an engineer to start using AI but you do need to be curious.

— The Girls Into VC Team 💕