The Venture Capitalist Who Finds the Best AI Products—Before They Win - Ep. 45 with Nabeel Hyatt

Nabeel Hyatt is looking for the “Japanese toilets” of AI—products that delight users in unexpected ways.

As a partner at Spark Capital, that investment philosophy has paid off. Despite making only 1-2 investments a year, he’s picked some of the biggest winners in AI so far: Descript, Cruise, and Granola.

We spent an hour unpacking:

How much “leash” top products give to AI agents—and why that matters

How he spots remarkable AI products

Why “sensitivity” is one of the most important traits of top founders

The huge opportunities for AI products to help users explore new “possibility spaces”

How Nabeel is actually using AI tools like ChatGPT, Claude, and AI code editor Windsurf in his life

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Timestamps:

Introduction: 00:01:32

Why Nabeel doesn’t invest in more than two companies per year: 00:01:50

Why the words you use to describe your business matter: 00:06:49

What a product with soul looks like: 00:13:45

Patterns in the remarkable founders Nabeel has invested in: 00:16:48

How Nabeel evaluates popular coding agents: 00:24:12

AI has broadened the horizons of what Nabeel can do: 00:32:29

How funding models are changing as AI makes it cheaper to build software: 00:36:28

Nabeel’s framework for when to trust an LLM: 00:45:43

Guide AI to provide context (and not just quick answers): 00:55:39

Links to resources mentioned in the episode:

Nabeel Hyatt: @nabeel, https://nabeelhyatt.com/

Spark Capital: https://www.sparkcapital.com/

The piece Chris Pedregal wrote for Every: How to Build a Truly Useful AI Product

Chris Pedregal on AI & I: 🎧 The Secret to Building Sticky AI Products

The AI tools Nabeel talks about: Windsurf, Wordware