Summary:
Citi Ventures is a leading corporate venture investor focusing on AI startups.
Matt Carbonara highlights the disruptive potential of AI in enterprise investing.
Citi Ventures actively seeks companies that can help transform Citigroup's business model.
The firm has invested in innovative AI companies like Glean, Writer, and Norm Ai.
Citi Ventures ranks among the top 10 corporate venture firms in AI.
Editor’s Note
This article is part of an ongoing series in which Crunchbase News interviews active investors in artificial intelligence.
Citi Ventures: A Leader in AI Investment
In our final article of the AI investor series for 2024, we had the opportunity to speak with Citi Ventures, recognized as one of the most active corporate venture investors over the last decade, focusing on its investment strategies in AI.
Matt Carbonara, managing director for Citi Ventures
A Disruptive Era in Enterprise Investing
Matt Carbonara, the managing director for Citi Ventures, shared, "We haven’t seen anything this disruptive in all my time in enterprise investing, for the last 20 years." He emphasized that AI is driving more customer motivation than any other new technology, with numerous Fortune 2000 companies exploring various use cases.
The Alignment of Interests
According to Carbonara, entrepreneurs are constantly on the lookout for opportunities to innovate, while investors are eager to back companies with the potential for big outcomes. This alignment of interests fosters a dynamic environment for investment in AI.
Fast-Paced Investments
Citi Ventures is committed to moving quickly in this competitive landscape, building relationships with potential investment opportunities ahead of their financing rounds. Carbonara stated, "It’s been a very active area."
Targeting Transformative Companies
The firm specifically targets companies that can assist CitiGroup in transforming its business models. Carbonara identified key areas of focus including coding, compliance, regulation, data quality, employee productivity, and knowledge management.
Automation in Wealth Management
Citi’s wealth management division stands to benefit significantly from AI-driven automation. With around 40,000 developers, even a 10% productivity gain could lead to substantial improvements for Citi.
Portfolio Highlights
Citi Ventures has backed several innovative AI companies, including:
- Glean (knowledge management)
- Writer (content generation)
- Norm Ai (compliance technology)
- Poolside (developer productivity)
- Galileo (AI model accuracy monitoring)
Recent Acquisitions
Two of Citi’s portfolio companies were acquired this year:
- Lexion, acquired by Docusign for $165 million, specializes in AI for contract workflows.
- Datavolo, acquired by Snowflake, focuses on data extraction from PDFs and documents.
Standing Among Corporate Giants
Citi Ventures ranks among the top 10 corporate venture firms investing in AI. Its team operates globally with 120 active portfolio companies.
The Competitive Landscape
Other notable corporate venture firms investing in AI include Google Ventures, Samsung NEXT, and Salesforce Ventures.
AI Adoption Trends
Most of Citi Ventures’ portfolio companies have integrated AI to some degree, with a notable shift towards native AI applications yielding real revenue. Carbonara noted that while generative AI is gaining traction, the majority of interest lies in more established AI applications.
Accelerated Adoption
Carbonara highlighted the growing adoption of applied AI and the emergence of companies with significant revenue, such as Glean and Writer, which are quickly becoming prominent players in the market.
Related Reading
- Citi Ventures Native AI Portfolio Companies
- How Banking Giant Citi’s VC Arm Invests In Billion-dollar Exits
Illustration: Dom Guzman
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