CVCs add the greatest value to the cap table by becoming relentless advocates—proactively opening doors, creating strategic partnerships, and championing portfolio companies within the parent organization and beyond. 
“Every Company Will Be an AI-Forward Company,” Says Flybridge and Harvard’s Jeff Bussgang, Author of The Experimentation Machine
Interviewed February 28th, 2025
Introduction
“Every company will soon be an AI forward company,” asserts Jeff Bussgang, General Partner & Cofounder of Flybridge Capital Partners. For the milestone 100th episode of Corporate Venturing Insider, host Nicolas Sauvage of TDK Ventures sat down with Jeff Bussgang — a leading venture capitalist, celebrated Harvard educator, and author of the newly released book The Experimentation Machine: Finding Product-Market Fit in the Age of AI.
Flybridge Capital Partners is an early-stage venture firm managing over $1 billion across six funds, and Bussgang has been instrumental in the early success of their portfolio companies MongoDB, DraftKings, FalconX, and CodeAcademy, among others. During their conversation in late February, Bussgang shared insights into his remarkable career journey, groundbreaking perspectives on artificial intelligence, strategies for identifying and nurturing exceptional founders, and critical best practices for corporate venture capital (CVC).
Early Career: BCG to OpenMarket
Jeff Bussgang’s journey into what he fondly calls “startup land” began early. “I was a computer nerd as a kid in the ’70s and ‘80s,” Jeff recalls, “teaching myself programming languages like Basic and Fortran.” After graduating from Harvard with a degree in computer science, Bussgang joined the Boston Consulting Group (BCG) to build foundational business skills before swiftly returning to Harvard for an MBA.
However, consulting wasn’t his calling. In 1995, he took a leap into entrepreneurship by joining an internet startup called OpenMarket. “I joined an internet software company back when there weren’t that many,” Bussgang shares. The decision paid off remarkably — OpenMarket became one of the earliest internet successes, achieving an IPO within a year. Bussgang spent five years scaling the company into a multi-billion-dollar entity. Despite external appearances of success, the reality was intense: “We were like a duck — calm on the surface but paddling furiously underneath.” OpenMarket, during Bussgang’s tenure, almost ran out of money, had product failures weeks before the IPO, missed sales projections, and failed at several acquisitions. It was a very fast-paced and challenging experience. After OpenMarket, Jeff co-founded Upromise, a fintech startup that achieved a successful acquisition within 3 years.
Founding Flybridge
By 2002, sensing opportunity post-dot-com crash and with fresh cash from the acquisition of Upromise, Bussgang, and cofounder Chip Hazard founded Flybridge Capital Partners to back the next generation of transformative startups in the Northeastern USA. Today, Flybridge boasts 11 unicorns and has fostered significant IPOs and acquisitions.
Flybridge’s investment thesis revolves around “AI-native companies,” encapsulated in their “AI 3rd Wave thesis.” Jeff explains, “We believe every company will soon be an AI company. Founders who use AI will replace those who don’t — we want to invest in these 10X founders.” These exceptional founders leverage AI to amplify their operational efficiency dramatically. “Can you build a billion-dollar company with 100 employees, 50, or even 10? Sam Altman famously asked last year, ‘Could you imagine a billion-dollar company with just one employee?’” Jeff adds.
Jeff predicts significant shifts in how companies measure productivity: “Perhaps we’ve reached peak employment, especially among tech’s Magnificent Seven. Soon, companies might report ‘revenue per employee’ or even how many AI agents they employ.”
Jeff’s fascination with AI extends beyond investments, actively incorporating AI into his teaching and writing. “When new AI tools emerge, I’m among the first to experiment. I’ve built a chatbot in Delphi.ai for my Harvard students, trained on my own cases and writings,” he enthusiastically notes.
This passion culminates in his latest book, The Experimentation Machine, described by Eric Ries, author of The Lean Startup, as “the perfect guide for AI-era founders.” Jeff elaborates, “The ‘Experimentation Machine’ is a mindset that started with The Lean Startup and has really flourished with modern AI tools that allow one to experiment more efficiently and effectively to find product market fit rapidly. That’s the essence of the book.”
Lessons for Corporate Venture Capitalists
Jeff emphasizes that exceptional corporate venture capital (CVC) programs operate far beyond financial investment — they become active champions for their portfolio companies. “The best CVCs do more than write checks — they act like part-time VPs of business development,” Jeff explains. “They shamelessly advocate for startups within their organizations, proactively making introductions, opening doors, and generating tangible business value.”
He recounts a powerful example: “One CVC investor literally showed up unannounced at his CEO’s office, insisting on meetings for our startup. He was shameless. That’s what we want to see from the CVCs in our cap table.”
Yet, Jeff also warns against costly mistakes”We once had a CVC investor who blocked a perfectly reasonable $200 million acquisition simply because they wouldn’t show a loss,” Jeff recounts. “They wanted a guaranteed 1.25x return, risking the entire deal.” Reputation takes years to build but only moments to destroy. Jeff cautions that the firm has now been ‘blacklisted’, “ Nobody on that cap table will ever work with that CVC again. We tell founders this story and that they shouldn’t work with this firm.”
A Prepared Mind and Diligent Investing
Jeff’s investment philosophy is rooted in what Warren Buffet’s late partner, Charlie Munger, called the “prepared mind.” Flybridge exemplifies this through rigorous preparation and clearly defined investment criteria before evaluating start-ups. “When entrepreneurs meet our criteria, we act decisively,” Jeff explains. “Preparation is crucial — nothing kills deals like time.”
However, Jeff also acknowledges the power of outliers, noting exceptional opportunities can arise outside predefined criteria. He references Glimpse Engineering — a cloud-based EV battery testing startup that attracted investment from Flybridge and TDK Ventures — as a case study in balancing intuition with diligence. “We weren’t experts in batteries or EVs. It required multiple meetings and deep diligence before we were convinced,” Jeff shares.
Additionally, Bussgang believes an additional exception should be made in the case of markets with exceptional tailwinds or the asking price might seem high. “We have historically had a high conviction that amazing markets will result in great outcomes, even with mediocre teams and mediocre execution,” Jeef explains. “Also sometimes you must pay up for exceptional teams with extraordinary market tailwinds.” This strategy proved successful with MongoDB (IPO at $1.6 billion) and FalconX (valued at $8 billion, pre-IPO). Many would have now enjoyed joining FalconX’s $1 billion seed round in 2019.
Advice for Emerging CVC Programs
Drawing from his extensive experience, Jeff has pointers for new CVC programs. “Seek out mentors you admire outside your firm. There are great mentors within a firm, but exceptional seasoned investors outside. This craft takes decades to learn since it takes 8–10 years for cycles to play out,” he advises. “Finding those potential mentors in the boardroom is very valuable.”
Jeff’s teaching at Harvard significantly shapes his investment approach, with courses like “Launching Technology Ventures” and “Venture Capital Journey” educating thousands of aspiring founders and investors over 15 years.
As Corporate Venturing Insider celebrates its landmark 100th episode, Jeff Bussgang’s unique blend of entrepreneurial grit, investment acumen, and academic insight sheds invaluable light on navigating the AI-driven future. For corporate venture capitalists aiming to excel in a rapidly evolving landscape, Jeff’s advice is clear: embrace the AI-driven ‘Experimentation Machine’ mindset, advocate fiercely for startups, and stay relentlessly curious. In a rapidly evolving market, the winners will be those who blend rigorous diligence with bold vision — just as Jeff Bussgang has done throughout his career.
