Is this spelling a way of things to come in 2025? Strong businesses will get a good exit. While Caroline, thanks for having me. It's great to be here and we're really excited to celebrate ServiceTitan's IPO today. I think that there's a lot of positive

signs on the macro. And also, even if you look back in 2024, we've had a handful of successful tech IPOs. We have a new administration going forward, maybe some different regulation around AI and M&A. And so we hope that this will be a

tailwind for a great crop of other fantastic private companies to go public. Nina, take us back to the journey of how it started with ServiceTitan and what were the key learnings from having made that first check into them and that trajectory since?

Well, at Index, when we make investments and we try to invest as early as possible, it is really all about the entrepreneurs and it's hard to find a more mission-driven set of co-founders than our own, who, as they shared,

really built this business to solve a problem that their dads had. And then they realized that this market was absolutely enormous and actually one of the backbones of America. And what really drives them is bringing cutting-edge technology, like, for example, now even AI to some of these

industries that were very much forgotten by technology for a very long time; a lot of them haven't been forgotten with cybersecurity, for example. Another tailwind, I'm sure, unfortunately, because we keep seeing more and more upending of whether people are trying to get money from us,

trying to be able to penetrate businesses in certain ways. What are the other tailwinds going into 2025? Yeah, well, I think that identity is going to be really important. You know, everybody is talking about these agents and you can imagine how

important it is going to be to actually prove you are a human being and the person that you say you are. So, for example, one of our portfolio companies, Persona, that started doing KYC for a lot of crypto and fintech companies, is now being used by some of the leading-edge A.I.

companies to make sure that the person that is using the ML model on the other side is actually who they say they are. And so I think we'll start to see a lot more companies like this really, in the wake of the incredible technological

shift that AI has brought to the world—now eyeball scanners as well.  But I'm interested, Nina, about some of the valuations that you're seeing on these generative AI-adjacent businesses. Are they still incredibly heady? Are you still able to get in on a decent

You know, the valuations are still pretty high for AI, and it's definitely a tale of two cities. Whether you're an AI company, you get a premium on valuation, and if you're not, it's more of the traditional SaaS metrics. But I think 2025 is going to be all about showing me the ROI of investing in and buying AI.

And that's why I think a lot of companies that are industry-specific AI solutions will probably have a front-row seat to being able to demonstrate how they have embedded AI into their value

a proposition for their end customers. That is, either help them generate revenue or save costs. And so it's going to be interesting to watch how those numbers come out in 2025 on our ROI. And there's been a lot of hand-wringing around that, and a lot of people trying

to say, "Just show me the ROI."  When you hear nonstop about gentle AI, are you slightly thinking this is hype, or do you actually believe there is real productivity to be had here, and we're going to show you? Well, I think I always have to think of

investments and trends as both bottoms-up and top-down. You know, top-down, we've got the foundational models and the algorithms, which have been absolutely incredible. And I think 2023 and 2024 have all been about,

you know, how does the dust settle on how we use this technology? And then bottoms-up is starting really with a customer problem. What is the problem you're trying to solve for your customer, and how much are they willing to pay you?

And I think we're still in the early innings of that, and I think that will be the future of Avaya's investments in the next two years.

Tech Investment Trends for 2025

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Bloomberg Technology

ServiceTitan's IPO and Positive Market Outlook

Positive outlook for strong businesses, anticipating good exits in 2025.

Successful tech IPOs in 2024 and hopes for continued success with new administration and potential AI/M&A regulation.

Discussion about ServiceTitan's journey and key learnings from initial investment.

ServiceTitan's Mission and Market Opportunity

Focus on mission-driven co-founders who aimed to solve a problem and tapped into a large market.

Bringing cutting-edge technology, including AI, to previously underserved industries.

Cybersecurity as a significant tailwind due to increasing threats.

Importance of identity verification, particularly with the rise of AI.

Portfolio company Persona's KYC solutions used by AI companies for user verification.

Increased use of identity verification technologies like eyeball scanners due to AI advancements.

High valuations for AI companies, a contrast to traditional SaaS metrics.

Focus on demonstrating ROI of AI investments in 2025, particularly for industry-specific solutions.

Emphasis on showing how AI generates revenue or saves costs for end customers.

Considering AI investments from both top-down (foundational models) and bottom-up (customer problem) perspectives.

Focus on understanding practical applications and customer value of AI technology.

Belief that the future of AI investments lies in solving customer problems and demonstrating value.