ICONIQ's Anders: AI Investments Require Discipline

In Brief: Bloomberg's Caroline Hyde interviewed ICONIQ Capital Founding Partner Michael Anders at Bloomberg Invest, where he discussed the firm's strategic approach to AI investments amid current market uncertainty. Anders highlighted ICONIQ's selective investment strategy, noting they've only backed 12 "native AI" companies out of thousands reviewed, while emphasizing the importance of infrastructure and application-layer opportunities.

Big Picture Drivers

Network effect: ICONIQ built its strategy around curating an exceptional group of founders and CEOs across industries and geographies, using their collective intelligence to spot investment trends.
Infrastructure foundation: The firm recognized early cloud migration trends, becoming one of the largest data center landlords for hyperscalers worldwide.
AI integration: Every company in ICONIQ's portfolio is now embedding AI capabilities, regardless of their original business model.
Global innovation: Despite U.S. advantages, breakthrough AI developments are emerging globally, with 25% of ICONIQ's AI investments outside the U.S.

Key Topics

Investment discipline: Despite examining thousands of AI companies, ICONIQ has only written 12 checks to "native AI" businesses, maintaining their focus on companies with strong tech teams, clear product roadmaps, and proven revenue.
Application focus: While monitoring the LLM race, ICONIQ concentrates on application-layer companies that enhance customer experiences and drive employee efficiency.
Technology stack: AI is becoming the tech layer that sits on top of the horizontal technology integration across all industries.
Impact investing: ICONIQ applies AI solutions to impact areas through collaborative philanthropic models, such as their $50 million Ocean Health collaboration.

Key Insights

AI evolution: Anders identifies three stages of AI development: machines that can think, reason, and soon act - with the acting component bringing us closer to AGI.
Open vs. closed: The debate between open and closed AI architectures will determine future funding requirements, with open models potentially enabling more players to enter efficiently.
Return to liquidity: Anders predicts a return to IPO markets between 2025-2026 after the interest rate reset period of 2022-2023.
Digital workforce: One of the most significant implications of AI will be the shift toward "digital employees," with humans taking more managerial roles.

By The Numbers

Selection ratio: Out of "thousands" of AI companies reviewed, ICONIQ invested in just 12 native AI businesses.
Global reach: 25% of ICONIQ's AI investments are outside the United States.
Impact scale: The Ocean Health collaborative was funded with approximately $50 million from ICONIQ families.

Memorable Quotes

"Every one of the companies in our portfolio, whether they started off as a traditional SaaS business, is now embedding AI."
"We hate losing money, and so we try to underwrite to businesses that have incredible tech teams, incredible product roadmap, have customers, have something that's working."
"One of the most exciting things about AI is this notion of agents, this notion of digital employees, and how we are going to be playing more of a manager role."

The Wrap

As AI transforms from an emerging technology to an essential business component, ICONIQ's approach demonstrates the value of disciplined investing paired with collaborative intelligence. Anders emphasizes that long-term success requires not just identifying technological winners but also addressing AI's broader social implications through intentional collaboration among diverse stakeholders.