How we make money
In a great market — a market with lots of real potential customers — the market pulls product out of the startup.
- When a great team meets a lousy market, market wins.
- When a lousy team meets a great market, market wins.
- When a great team meets a great market, something special happens.
— Marc Andreessen
Our Markets
We focus on markets where these breakthroughs are just beginning:
| Market | 2025 | 2032 | Growth |
|---|---|---|---|
| AI Agents | $3.7B | $104B | 44.9% |
| Edge AI Hardware | $27B | $270B | 33.3% |
| Datacenter AI Hardware1 | $142B | $837B | 34.3% |
| GPU Cloud | $6B | $74B | >35% |
| Hyperscaler 2 | $231.2B | $2.1T | 37.8% |
| Generative AI | $40B | $1.3T | 42% |
| Robotics | $90B | $350B | 15.2% |
These markets represent massive potential. Even a small slice—just 0.01%—would mean $213.4M in revenue by 2032.
But the real opportunity is in creating the value.
Value Creation vs Value Capture
“A platform is when the economic value of everybody that uses it, exceeds the value of the company that creates it. Then it’s a platform.” — Bill Gates
We build for creating value:
- Create massive value through open source
- Grow the entire industry
- Capture a small percentage of the expanded market
This creates a virtuous cycle:
- Open source drives adoption
- Adoption expands the market
- Market expansion increases our opportunity
- Small percentage of large market = significant value
Being Frugal
Success equation: Revenue minus Costs. We’re good at the second part.
Constraints breed innovation:
- Resourcefulness over resources
- Creativity through limitations
- Solutions without spending
Menlo started as an open source project, with very little money. This has shaped our DNA:
- Choosing essential tools (e.g. Discord over Slack)
- Growing at $0 CAC without ads
- Building by creating value, not burning money
The foundation of our perspective is Lateral Thinking.