Kevin Rose has an intuitive rule for evaluating investments in AI hardware. “If wearing it makes you want to punch someone in the face, you probably shouldn’t invest in it.”
It’s a typically candid assessment from the veteran investor, which comes as he watches the current wave of AI hardware startups repeat the mistakes he’s seen before. Rose, a general partner at True Ventures and an early investor in Peloton, Ring, and Fitbit, has largely avoided the AI hardware gold rush that has swept Silicon Valley. While other venture capitalists are rushing to throw money into developing the next smart glasses or AI pendant, Rose is taking a decidedly different approach.
“A lot of it is like, ‘Let’s listen to the whole conversation,’” Rose says of current AI wearable products. “And to me, that destroys a lot of the social constructs that humans have around privacy.”
Rose speaks from experience. He is a director at Oura, which currently controls 80% of the smart ring market, and has seen firsthand what separates successful wearables from unsuccessful wearables. The difference is not only in technical ability. It’s emotional resonance and social acceptability.
“As an investor, you need to not only say, sure, it’s a cool technology, but emotionally, how does it make me feel? And how does it make other people around me feel?” he explained on stage at TechCrunch Disrupt last week. “And to me, a lot of that gets lost in everything AI-related. It’s just always on, always listening, always trying to be the smartest person in the room. And that’s not healthy at all.”
He admits that he has tried out various AI wearables himself, including the failed Humane AI pendant that briefly captured the world’s attention a year ago. But the breaking point came during an argument with his wife. “I was like, I know I didn’t say that, and I was actually trying to use that to win the argument,” he recalled. “That was the last time I wore that. You don’t want to win a fight by going back in time and checking the log of AI pins. That doesn’t work.”
The use case of asking glasses to tell tourists which monument they’re looking at isn’t sufficient, Rose said. “We tend to put AI in everything, and it’s ruining the world,” he said, pointing to features like the Photos app that lets you remove people from the background. “I had a friend who erased the gate in the back to make the picture look better. I said, ‘That’s your garden! Your kids will look at it and say, ‘Didn’t you have a gate there?'”
Rose worries that we are in the “early days of social media” with AI making decisions that may seem innocuous now but will come back to haunt us later. “We’ll look back and think, ‘Wow, that was weird. We just put AI in everything and thought it was a good idea.’ That’s what happened in the early days of social. We’ll look back in 10 or 20 years and say, ‘I wish we had done things differently.'”
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He has experienced these tensions firsthand with young children. After using OpenAI’s video generation tool Sora to create a video of a small Labradoodle, his children asked where they could get the puppy. “I feel like it’s not my real dad there. How do we have that conversation? It’s very awkward,” he says. He explained that his solution is to treat the AI like movie magic, and just as the actors aren’t actually flying on screen, the daddy puppies aren’t real either.
But Rose is no Luddite. He is extremely optimistic about how AI will transform entrepreneurship itself and, by extension, the venture capital industry that funds it.
“The barriers to entry for entrepreneurs are getting smaller every day,” Rose said. He recounted a colleague who had never used an AI coding tool before building and deploying a complete app during a drive from LA to San Francisco. Six months ago, the same task would have taken 10 times as long and required dozens of errors to avoid.
“After three months, [Google’s] “When Gemini 3 hits the market, there will be zero or near zero errors. High school coding classes will no longer be coding classes; they will be vibrational coding classes, building the next billion-dollar business launched from random high schools,” Rose predicted. It will happen. It’s only a matter of time. ”
These developments completely change the venture capital equation, Rose said. Entrepreneurs can now postpone raising capital until absolutely necessary or skip external financing altogether. “This is really going to change the VC world, and I think it’s going to be for the better,” Rose said.
Many venture companies have responded by hiring large numbers of engineers, such as Sequoia Capital, which now employs as many developers as it has investors. But Rose doesn’t think that’s the answer. Instead, he believes the value proposition for VCs will shift to something more fundamental. “Ultimately, entrepreneurs will face non-technical problems,” he argued. “These are very emotional issues, so I think you’re going to want a VC with the best emotional intelligence who can best serve founders as a long-term partner, a VC who’s been with the company and hasn’t bounced around, not just a fly-by-night VC, but a VC who’s been around all the time and seen these issues at scale.”
So, what does Rose pay attention to when investing? He recalls something Larry Page said to him a few years ago when he was at Google Ventures, where Rose was working in his first institutional investment role after co-founding the social news platform Digg and before joining True Ventures in 2017. “A healthy disregard for the impossible is the important thing to look for.”
“What we want is founders who aren’t just sanding the rough edges, but really taking on the challenge with big, bold ideas that make everyone else say, ‘That’s a terrible idea. Why are you doing this?'” Rose said. “That’s what draws me to it, because even if it doesn’t work out, we love your heart. We love where you are, and we’d be happy to support you a second time.”
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