Ep 150: How AI Is Transforming Diligence, Decision-Making & the Future of Investing with John Melas-Kyriazi

Key Takeaways

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  AI serves as a technical copilot for diligence

  “AI as a technical co-pilot for diligence is actually one of the most interesting use cases for AI as an investor right now. If you come across a really interesting company in a field that you know a little bit about but you're not an expert in, you can get really, really deep within the matter of hours, and then pull in human experts to help you to go the last mile. Whereas five years ago, it would have been this mad scramble, calling people, trying to assemble folks that might have taken days or weeks.”

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  Investors use LLMs to challenge internal arguments

  “They're using tools like Cloud and Chatch GPT to poke holes in them. What am I missing? Where's my argument weakest? Investors for decades have not had access to the kinds of tools that they need to really operate their businesses in a data-driven way.”

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  AI automates complex Excel-based financial modeling workflows

  “You can go into Excel, hook it up with Cloud, hook up Cloud with Standard Metrics, and then ask it to do a discounted cash flow. It will just build it for you. It's amazing. People are going to be able to spend more time on what they're truly passionate about.”

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  Data centralization powers smarter private market decisions

  “When I was at Spark... I started realizing that very few investors in the private markets really had access to great software. It was this cottage industry that had suddenly grown a lot and become very competitive and very global, but software hadn't yet caught up. If people had access to better data, they could make better decisions.”

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  AI lowers barriers to understanding academic research

  “I think that as a VC, having the ability to tailor the output of a model to meet you where you're at from an understanding perspective is one of the most useful aspects. Opening up a 10, 15 page long academic paper full of citations is extremely intimidating. The AI can remove some of that barrier.”

Episode Description

John Melas-Kyriazi is the co-founder and CEO of Standard Metrics, which powers portfolio management for more than 150 venture capital firms and 10,000 companies. He runs a high-growth SaaS company at the leading edge of the AI wave. How is AI transforming how investors source and diligence deals? How are agents parsing pitch decks, prepping board meetings, and building powerful new workflows? And as competitive advantages shift, what are the new moats for SaaS companies in the AI age? We discuss these and other timely topics with John. At an early age, he fell in love with science fiction and built vacuum-tube amplifiers in his parents' basement, before studying physics and materials science at Stanford. There he became a research scientist until pivoting to investing, first at StartX and later Spark Capital. Born out of firsthand experience, he co-founded Standard Metrics alongside the 8VC Build team to create a better solution for portfolio management software. We begin our conversation with John’s path from academia to investor and founder. Next, we explore how Standard Metrics centralizes data, improves portfolio intelligence, and powers smarter investment decisions. Then we dive into the new possibilities with AI, from technical diligence copilots and investment stress-testing to new workflows and internal AI analysts. In an era of new agentic tools and shifting competitive advantages, we discuss new moats for existing software companies built around network effects, data, and more. The world of finance is changing quickly; John offers a unique perspective on the AI wave and how top investors are leveraging new workflows to get ahead. 00:00 Episode intro 02:10 Academia to investor and founder 08:00 The pain point that led to building Standard Metrics 12:10 How AI is transforming venture capital 14:20 AI as a technical copilot 17:10 AI Analyst vs human in the loop 19:20 Parsing pitch decks and new AI tools 23:10 How AI search is changing marketing 28:30 New capabilities and workflows 33:47 How quickly is everything changing? This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit blog.joelonsdale.com