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Union Square Ventures2024 USV Core Fund
We recently started investing out of our newest USV Core Fund. As with each of our previous funds, while it is a new vehicle, our approach will stay the same: small fund, thesis driven, high conviction, and low velocity. We’ll focus on being long term and dedicated partners to a small number of teams creating projects and businesses that are aligned with our thesis. We’ll continue to commit once and then partner with the companies throughout their lifetimes. We run a collaborative partnership...
Union Square VenturesInvesting at the Edge of Large Markets Under Transformative Pressure
Union Square Ventures turns 20 this year. Brad and Fred began to deploy the first USV fund in 2004. The dot com bubble had recently popped, mod...
Union Square VenturesWe're Hiring
Union Square Ventures2024 USV Core Fund
We recently started investing out of our newest USV Core Fund. As with each of our previous funds, while it is a new vehicle, our approach will stay the same: small fund, thesis driven, high conviction, and low velocity. We’ll focus on being long term and dedicated partners to a small number of teams creating projects and businesses that are aligned with our thesis. We’ll continue to commit once and then partner with the companies throughout their lifetimes. We run a collaborative partnership...
Union Square VenturesInvesting at the Edge of Large Markets Under Transformative Pressure
Union Square Ventures turns 20 this year. Brad and Fred began to deploy the first USV fund in 2004. The dot com bubble had recently popped, mod...
Union Square VenturesWe're Hiring
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It is said that while history doesn’t repeat, it does rhyme. This is a pattern we've observed before in the Internet era.
When a novel technology arrives, early infrastructure is controlled (or attempted to be controlled) by a small number of players who prefer to create and extract value inside their walls (so called “walled gardens”). The user's experiences here are typically good enough (or novel enough) that most users don’t ask what they're missing. And then something happens: bottom-up, a set of open protocols emerges that are permissionless and composable. From here, native use cases that couldn't exist inside the walled gardens begin to bloom.
Some examples demonstrate this: AOL in the mid-90s, or the carrier deck era of mobile. And yet what we have also seen, that the walled gardens almost always lose to the open protocols, eventually. Not because open is ideologically superior as an idea (though we do believe that). But because the surface area of permissionless systems is simply larger. More builders. More experiments. More weird, unexpected things that nobody planned. Permissionless innovation works.
We might be early in a version of this story playing out with AI.
The large model providers are remarkable. We use them every day. The products are useful and delightful. And like the past, their gravitational pull towards keeping users and workflows inside their own surfaces is in evidence and structural - it's how they capture value and create moats.
It is said that while history doesn’t repeat, it does rhyme. This is a pattern we've observed before in the Internet era.
When a novel technology arrives, early infrastructure is controlled (or attempted to be controlled) by a small number of players who prefer to create and extract value inside their walls (so called “walled gardens”). The user's experiences here are typically good enough (or novel enough) that most users don’t ask what they're missing. And then something happens: bottom-up, a set of open protocols emerges that are permissionless and composable. From here, native use cases that couldn't exist inside the walled gardens begin to bloom.
Some examples demonstrate this: AOL in the mid-90s, or the carrier deck era of mobile. And yet what we have also seen, that the walled gardens almost always lose to the open protocols, eventually. Not because open is ideologically superior as an idea (though we do believe that). But because the surface area of permissionless systems is simply larger. More builders. More experiments. More weird, unexpected things that nobody planned. Permissionless innovation works.
We might be early in a version of this story playing out with AI.
The large model providers are remarkable. We use them every day. The products are useful and delightful. And like the past, their gravitational pull towards keeping users and workflows inside their own surfaces is in evidence and structural - it's how they capture value and create moats.
What's more interesting to us is what the open layer makes possible - what's now being built around the edges. Open source models closing the possibility gap. Protocols like x402 (which interestingly revives the HTTP 402 status code to enable machine-readable payments) that let agents transact natively on the web without asking a human to authenticate every step. Model Context Protocol, CLIs, and open skills frameworks are all other examples - giving agents the capabilities to work across siloed systems without a single orchestrating platform at the center. The meteoric growth of OpenClaw suggests the large pull of these approaches.
These are like Lego bricks - the pieces comprise a new open architecture where agents can act, pay, and compose across an open, permissionless, surface rather than inside a closed one. Composable protocols handling identity, context, and now payments. Imagine an architecture where agents act across an open surface rather than inside a closed one, where the AI application layer is structurally open in the way the early web was open.
In this push towards openness, agents’ collective power is just as important as the tools now available to them. Agents could be poised to become the primary actors on the internet. Where humans became trained to jump into walled gardens, agents want nothing more than to access and test services and data at the speed of thought. Services that stay closed and do not orient themselves around serving agents risk withering and those that make an agent’s path open and easy likely could thrive.
Native use cases for consumer agents are just beginning to emerge. When the permissionless layer is still being built, the applications that depend on it are still largely uninvented. We are paying attention and investing here.
Because history doesn't repeat. But it does rhyme.
What's more interesting to us is what the open layer makes possible - what's now being built around the edges. Open source models closing the possibility gap. Protocols like x402 (which interestingly revives the HTTP 402 status code to enable machine-readable payments) that let agents transact natively on the web without asking a human to authenticate every step. Model Context Protocol, CLIs, and open skills frameworks are all other examples - giving agents the capabilities to work across siloed systems without a single orchestrating platform at the center. The meteoric growth of OpenClaw suggests the large pull of these approaches.
These are like Lego bricks - the pieces comprise a new open architecture where agents can act, pay, and compose across an open, permissionless, surface rather than inside a closed one. Composable protocols handling identity, context, and now payments. Imagine an architecture where agents act across an open surface rather than inside a closed one, where the AI application layer is structurally open in the way the early web was open.
In this push towards openness, agents’ collective power is just as important as the tools now available to them. Agents could be poised to become the primary actors on the internet. Where humans became trained to jump into walled gardens, agents want nothing more than to access and test services and data at the speed of thought. Services that stay closed and do not orient themselves around serving agents risk withering and those that make an agent’s path open and easy likely could thrive.
Native use cases for consumer agents are just beginning to emerge. When the permissionless layer is still being built, the applications that depend on it are still largely uninvented. We are paying attention and investing here.
Because history doesn't repeat. But it does rhyme.
Wrote down some thoughts on the present, the past, history, and what that might tell us about today, AI, agents and stuff "History Rhymes?" https://blog.usv.com/history-rhymes
also
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Wrote down some thoughts on the present, the past, history, and what that might tell us about today, AI, agents and stuff "History Rhymes?" https://blog.usv.com/history-rhymes
also