Rally Ventures

Cybersecurity was another major theme at our 2026 Annual Meeting. AI is giving attackers powerful new tools while also creating much stronger defenses for the companies that build AI into how they operate. Rally has been investing in cybersecurity for more than a decade, and our portfolio includes a number of companies tackling the AI era head-on, including Bugcrowd and Appdome. Bugcrowd has built one of the world's largest communities of ethical hackers across 100+ countries, and is now applying AI to that work for frontier AI labs. Appdome protects billions of mobile apps with 400+ defenses, processing over one trillion threat events every month and using that data to train AI that adapts to new attacks in real time. The pattern we keep seeing: the winners will be the ones who combine AI with deep human expertise and proprietary data.

Building an AI-native company in 2026 feels a lot like building an internet-native company did fifteen years ago. The companies that have built AI into the foundation of how they operate are pulling ahead of the ones layering it on top, and the gap is widening fast. This was a big topic at our 2026 Annual Meeting, where Ben Fried, Rally Venture Partner and former CIO at Google, led the conversation on where AI is heading and how we're thinking about it as a firm. A few things we keep coming back to with founders this year. First, AI is much bigger than LLMs. The big general-purpose models like ChatGPT and Claude get most of the attention, but some of the most defensible work we're seeing uses smaller, more focused kinds of AI to solve specific problems at a fraction of the cost. Captur, one of our recent investments, runs real-time computer vision directly on a phone with no internet connection required. Nothing else in the market can do that. Second, the LLM itself is often the easy part. Pricing for leading AI models has dropped by more than 80% over the last two years, which means the model is increasingly a commodity. The harder, more defensible work is everything around it. Take Incept AI's voice AI for drive-through restaurants. The specific LLM under the hood almost doesn't matter, because the real advantage is in the audio engineering, the menu logic and the speed. It's the best product in its category, and we backed the team early. The companies we have the most conviction in have built AI into the foundation of how they operate. These are founders who have spent years on a specific business problem and are using AI to do something that wasn't possible even a few years ago.

Last week's Annual Meeting in Menlo Park was a great chance to spend time with our investors, Tech Partners and entrepreneurs all in one place. We covered a range of updates on fund performance, market trends and the investment themes that have set Rally apart for more than a decade. A central theme this year was the way the software market is splitting in two. Generic, horizontal software is under real pressure as AI takes on more of the work that used to fill those seats. Software built deep inside regulated industries like financial services and healthcare is moving in the opposite direction. Companies like Vertical Insure and JustiFi are leaders in their categories because they rely on licenses, regulatory know-how and years of proprietary data that AI can't easily replicate. This is exactly where Rally has been concentrated for years, and we're leaning further in. Across our companies we're seeing strong execution turn into real performance, and we expect to keep building from here. More to share from the meeting throughout the week!

Our Why We Invested series is one of our favorite ways to share the thought process behind our investments and what convinced us these founders are building something big. The series introduces what makes their companies stand out and the lessons they've learned along the way. Features include Captur, where founder Charlotte Bax makes the case that the hardest part of building AI has nothing to do with the technology; Ankored, where founder Seth Lieberman explains why keeping kids safe in youth sports is a much bigger and more broken problem than most people realize; and Bbot, the story of three Navy nuclear engineers who built cutting-edge restaurant tech and sold it to DoorDash, and who we're now backing at Allen Control Systems. You can read the full series on our website: https://lnkd.in/gbkuw-P3

We are excited to welcome LIz Benz to Rally Ventures as an Operating Partner! Liz is a longtime Rally Tech Partner with expertise in business development, sales operations and revenue strategy. She spent most of her career inside high-growth technology companies, most recently as Chief Sales Officer at Jamf, where she helped take the company from $70M to more than $700M in ARR. In her new role, she'll work directly with our founders on GTM strategy and execution, with a particular focus on AI-enabled sales processes. Welcome, Liz! https://lnkd.in/g4Q8t-gd

Several Rally portfolio companies have built remote setups that reflect some genuinely creative thinking about what distributed work can look like. Incept AI runs an always-on Google Meet video call throughout the workday so teammates can see each other at their desks, replicating the natural awareness of a physical office. Oxide Computer Company has everyone earn the same salary, arguing that when pay is taken off the table, feedback gets more honest and hiring gets more deliberate. JustiFi has built a team across Minnesota and Brazil with virtually no turnover in five years, something they attribute to hiring carefully and giving people real ownership of their work. We got into the specifics of how each of these actually works, how teams have responded and what we're doing at Rally.

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We loved this conversation with Captur Founder & CEO Charlotte Bax and Rally Venture Partner Ben Fried. Here, they talk about what makes Captur such a compelling investment, why the hardest problems in AI are about people (not technology) and what founding 'Mars Needs Women' taught Charlotte about building something people genuinely care about. Welcome to the portfolio, Captur!