Looking ahead: 2024 predictions from the team at Madrona Venture Labs

By Mike Fridgen, Keith Rosema, Jay Bartot, Henry Huang & Jason Flateboe • Janaury 25, 2024

It's January, and no time of the year has more anticipation and excitement for what might be next in innovation. Every field is exploring new ideas and discovering new people and projects that will appear in the year ahead. Where will the next crop of exciting startups appear? Check out what our MVL partners are forecasting for the coming year in technology.

Mike Fridgen, MVL Managing Director, is looking at open source as an interesting area to watch. 2024 will see more companies developing tools and ecosystems around open-source generative AI models. There is a need for platforms and tools that enhance the accessibility, usability, and customization of open-source AI models. 

Mike also expects an increased focus on ethical, transparent, and responsible AI. Areas like bias mitigation, data privacy, and ethical AI frameworks will attract investment. MVL has already made bets in these areas, and more will follow.

Related to this: more funding for startups that offer solutions for managing and protecting AI-generated intellectual property. This includes software for tracking AI-generated content, verifying originality, and ensuring compliance with IP laws.

Keith Rosema, MVL Partner, is excited about AI at the Edge. He predicts 2024 will see a strong push toward AI at the Edge, especially in cars and phones and smart homes, manufacturing, and healthcare. "Maybe we will finally be able to tell our web cameras to spot wildlife, not the trash collector, or even have our doorbell cam send out the robot to chase the porch pirates."

It might also be time for the next generation of social media platforms. Vertically siloed social groups are growing, and Meta and X feel like your dad's, or maybe somebody else's dad's, social platform. The next ecosystem could be built around creators and influencers, catering to how a new generation looks for and participates in entertainment.

He also thinks it will be a year when big tech revisits its relationship with the entrepreneurial world. They've shed many jobs and will look to the startup world for freshness and innovation.

Jay Bartot, MVL Partner, sees the GenAI wave continuing to grow and accelerate. Another big release from OpenAI (GPT-4.5/5.0) is coming in the first half of 2024, and this will cause some earthquakes. Open-source models will also continue to improve (Mixtral, llama3) and will be adopted by startups needing to address their scalability and cost concerns as their Native GenAI apps gain momentum. However, open-source models will still be outpaced by OpenAI in 2024.

He also thinks that new GenAI-native apps, the so-called "wrapper" apps, will gain momentum and a loyal following due to their focus on utility, usability, and delight. "This could be big!"

Jay also warns that gaps between the corporate AI haves and have-nots will continue to cleave, causing BOD and executive-level rifts and exits across notable companies. AI Infrastructure (Chips/GPUs) shortages continue to worsen, and tensions over AI intellectual property could all cause friction and social discomfort.

Henry Huang, MVL Partner, is banking on prompt evaluation, becoming the most significant area of GenAI investment in 2024. Managing prompts and the returned output is critical to the success of nearly every GenAI company. There is an excellent opportunity for tools and platforms that generate, process, train, and test prompting systems.

Jason Flateboe, MVL Partner, expects to see significant strides in user experience in 2024. According to Jason, hyper-personalized experiences will continue to evolve and become the norm. Customers will increasingly expect customized interfaces and content driven by unique needs and preferences.  

Is ethical AI on center stage or new AI at the Edge? Open Source or OpenAI? Prompts or UX? What will 2024 bring us, and what great companies will we discover? Ride along with us in 2024 as we actively experiment in these areas. 

If you're a founder experimenting in these lanes or crafting something unique, we'd love to chat with you! Learn more about MVL by delving into our manifesto here.

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