Navin Chaddha, managing director at Mayfield in Silicon Valley, is betting big on the potential of AI to transform fields like consulting, law, and accounting. Speaking at a TechCrunch event in Menlo Park, he explained how ‘AI teammates’ can help these sectors operate almost like software companies in terms of profit margins.
Instead of going head-to-head with established giants such as Accenture, Chaddha recommends that startups target underserved markets. This approach recognises that disruptiveness isn’t about replacing trusted relationships but enhancing them with smarter, outcome-based solutions.
Chaddha envisions a future where combining AI with human expertise could unlock a $5 trillion market. He draws parallels with past shifts – from the e-business surge of the late 1990s to the rise of outsourcing trends – suggesting that AI, when used right, can add what he calls a ‘100x boost’ to human capability.
Take, for example, the implementation of Salesforce. With AI automating routine tasks while humans ensure quality, companies could scale their operations more efficiently, both organically and through strategic growth.
For small businesses that traditionally struggle to afford high-end consulting, AI offers the promise of affordable fixes. Think virtual receptionists or schedulers charged via outcome-based pricing, making expert support accessible without the steep time-based fees.
Chaddha also highlighted Gruve, an AI tech consulting startup he recently invested in. By blending organic and inorganic growth strategies, Gruve has managed to secure an 80% gross margin through its managed security services delivered on an outcome-driven basis.
The challenge for established firms like McKinsey is clear – adapting to this nimble, tech-driven approach. Much like the shift towards SaaS in enterprise software, these traditional players now face an innovator’s dilemma as they decide how to integrate AI into their longstanding practices.
Mayfield has committed $100 million toward investing in these ‘AI teammates’ – digital companions designed to work in tandem with humans rather than replacing them. While there are genuine concerns about job displacement, Chaddha is optimistic that the blend of AI and human skills will expand markets and open up new opportunities.
For investors navigating this evolving landscape, the advice is straightforward: stay disciplined and trust your own strategy rather than succumbing to the fear of missing out. After all, in a rapidly shifting market, a clear plan is your best asset.
