Elad Gil Bets Big on AI-Powered Rollups
The Visionary Investor’s Latest AI Frontier
While most investors were still processing ChatGPT’s debut, Elad Gil was already seeding groundbreaking AI startups like Perplexity, Character.AI, and Harvey. Today, the famed venture capitalist is pivoting to an ambitious new strategy: transforming traditional businesses through AI-powered rollups.
Redefining Business Growth with AI
Gil’s approach targets established, labor-intensive firms in sectors like legal and professional services. The playbook:
- Acquire mature businesses
- Supercharge operations with AI automation
- Leverage improved margins to acquire competitors
“Generative AI excels at language processing – whether text, code, or sales outreach,” Gil explains. “By converting repetitive tasks into software, we can dramatically boost margins and create entirely new business models.”
The Financial Power of Ownership
Gil emphasizes owning assets outright rather than selling SaaS solutions:
“When you own the company, transformation happens faster. Moving from 10% to 40% margins gives you unparalleled leverage for acquisitions.
His portfolio already includes two such ventures, including Enam Co., a productivity-focused startup valued at $300 million by backers like Andreessen Horowitz and OpenAI’s Startup Fund.
AI vs. Yesterday’s Tech-Enabled Rollups
Gil contrasts today’s opportunities with past failures: “Previous rollups used tech as window dressing. With AI, we’re fundamentally restructuring cost models.”
Spotting Winners in a Maturing AI Market
The investor notes clearer patterns emerging:
- Legal tech: Harvey (potential $5B valuation)
- Healthcare: Abridge ($250M Series D)
- Customer service: Sierra AI (launched with billion-dollar valuation)
“The landscape has crystallized – from two dozen contenders per vertical, we’re now seeing definitive leaders emerge,” Gil observes.
The Human Element in AI Innovation
Gil’s hands-on approach sets him apart:
- Tinkers with AI models personally
- Works with engineers to test new tools
- Seeks teams combining technical and private equity expertise
For this seasoned investor, the excitement lies beyond financial returns: “We’re at the intersection of AI’s evolution and its real-world transformation of entire industries. That’s where true innovation happens.”