Eclipse Ventures: Pioneering Investments in the Physical AI Landscape
All it takes is a quick glance at Eclipse’s recent investments to see where this venture capital firm’s interests lie – and where it’s headed.
The Palo Alto-based venture capital firm, which has seen its median deal size explode in recent years, has been investing increasing amounts in the “physical world.” Its deals include electric boat developer Arc, dynamic battery and materials recycling company Redwood Materials, autonomous construction vehicle startup Bedrock Robotics, autonomous vehicle technology company Wayve and industrial robotics lab Mind Robotics.
Eclipse’s Strategic Vision: A New Era of Technology
With $1.3 billion in new capital – split between a $591 million early-stage incubation fund and a fund more geared toward growing startups – Eclipse is focusing on what partner Jiten Behl describes as the next great era of technology.
“Over the past two decades, we have seen multiple waves of innovation,” Behl said, listing the eras of the Internet, mobile cloud, and social media. “This is the first time things are going to move from our screens to the physical world; we’re going to see advanced levels of intelligence, as well as real action, in terms of solving problems in the real physical world.”
The Collision of AI and the Physical World
AI and the physical world have collided; the omnipresence of the term “physical AI” is just one signal among many. Behl said this era is propelled by a confluence of talent, technological advancements, demand, and policies. And of course, capital.
“We have a nice war chest to make a serious dent in the market and support businesses in the right way throughout their life cycle,” he said.
Investment Strategy: Building a Collaborative Ecosystem
Eclipse is not innovating by investing in physical AI. After all, it’s the next shiny new thing to invest in. It is worth noting how Eclipse selects startups. Venture capital seeks to invest in all physical sectors, including transportation, energy, infrastructure, computing, and defense. The interesting part, as Behl described it, is a strategy to create a network or ecosystem of startups in overlapping fields that will likely become partners as they scale.
Emphasis on Scale and Collaboration
“Scale is so important, and if you can set it up in a way that companies partner up front to build scale, to build proof points, then that allows them to respond to the next round of demands,” Behl said, explaining that the portfolio companies will partner directly with each other, but hopefully also work with each other.
In some cases, these startups will be incubated within the confines of Eclipse. Behl said Eclipse plans to spin off companies from the new fund. And while he didn’t give many clues, he did confirm that the process has already begun.
“We’re definitely working on some really interesting ideas,” he said, noting that Eclipse is particularly interested in startups that work across multiple companies.
Connecting Sectors Through Data and AI
“The next step is: How do we connect these sectors? How do we build scale between sectors? And how do we use data between sectors to build that divide?” he asked, adding that the data would be used to train smarter AI models for the benefit of a wider group. “That’s kind of the general thesis that we’re working on.”
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