By: Tejas Vijh, Investment Team Member, Boomerang Ventures

When I first entered the venture capital world, I imagined my days filled with meeting visionary founders, analyzing financial models, and spotting the next big thing. And while those things do happen, what I didn’t anticipate was just how much of my work would involve sifting through endless data points, emails, and industry reports. That’s where artificial intelligence (AI) has stepped in—not as a replacement for human insight but as a powerful assistant that’s reshaping how we approach everything from deal sourcing to portfolio management. Based on my experiences and lessons learned as an early-career professional, here’s a glimpse into how AI is revolutionizing VC.

Deal Sourcing: Finding Hidden Gems Faster

Deal sourcing often feels like fishing in an ever-expanding ocean, where the right catch is elusive and constantly moving. AI tools like Affinity, PitchBook, and even ChatGPT have transformed this process for me. For instance, Affinity acts like a relationship whisperer. Analyzing my firm’s email and calendar interactions reveals hidden connections I never knew existed. One time, Affinity’s relationship scoring highlighted a warm lead to the founder of a promising AI startup—a connection I might have overlooked otherwise.

PitchBook, on the other hand, is my go-to for market intelligence. It’s like having a crystal ball that shows industry trends and company data, helping me spot patterns before they hit the mainstream. For example, during a deep dive into health tech, PitchBook’s analytics flagged a surge in teletherapy platforms. This trend indicated a growing market demand and opportunities for innovation in the space. By cross-referencing this with insights from AI tools, we contextualized the trend within broader industry movements, reinforcing its significance.

At Boomerang Ventures, where we focus on building and investing in healthcare startups, this process becomes even more critical. Healthcare is complex—with regulatory, product, and clinical considerations—and our small team needs every advantage we can get. AI tools help us create differentiation by streamlining deal sourcing and uncovering opportunities that align with our mission to support transformative healthcare innovations.

And then there’s ChatGPT and Perplexity, my AI-powered co-pilots for quick research. Whether it’s summarizing industry reports, brainstorming questions for founder meetings, or synthesizing scattered information into actionable insights, these tools help me work faster and smarter. They’re like having a brainstorming partner on call 24/7, ready to tackle even the most niche questions.

Enhancing Due Diligence: From Tedious to Transformative

Due diligence is the VC equivalent of detective work—digging into every corner of a startup’s financials, market position, and team dynamics. It can be overwhelming, but AI has made it more manageable.

One memorable example involved evaluating a health-tech company. Faced with a 50-page technical whitepaper, I turned to ChatGPT for a concise summary. In minutes, I had a clear understanding of the core technology, saving me hours of manual reading and letting me focus on strategic questions. This efficiency allowed our team to zero in on critical areas during follow-up discussions, leading to a more focused and productive evaluation process.

At Boomerang Ventures, where we operate with a lean team, these tools are indispensable. They enable us to perform due diligence at the same level as much larger firms, despite our limited resources. AI-powered risk assessments also analyze financial data and flag potential red flags like cash flow inconsistencies or market volatility. It’s like having an extra set of eyes that never tires or misses a detail. By layering insights from tools like Perplexity, we can even cross-check market conditions and competitive landscapes to provide a comprehensive view of potential risks.

Portfolio Management: Predicting Success and Intervening Early

Managing a portfolio is like juggling multiple spinning plates, each requiring careful attention. While my firm’s AI usage here is still growing, its potential is immense. For example, AI tools can predict performance by analyzing KPIs across our portfolio, alerting us to trends we might not catch on our own. Imagine an AI flagging a drop in customer retention at one company while suggesting strategies based on patterns from similar startups. It’s like having a seasoned mentor who never sleeps.

What’s particularly exciting is the ability to use AI for dynamic portfolio optimization. By continuously analyzing performance metrics and market data, AI tools can suggest when to allocate additional capital, recommend operational changes, or even indicate optimal timing for follow-on investments. This level of real-time insight has the potential to enhance decision-making and resource allocation significantly.

For a small firm like Boomerang Ventures, these capabilities are game-changing. With limited resources, AI helps us stay proactive and offer meaningful support to our portfolio companies, ensuring they have the best chance of success.

Spotting Trends: Reading the Signals

One of the most exciting uses of AI is in trendspotting. Natural language processing (NLP) tools analyze news articles, patents, and even social media to uncover emerging technologies and market shifts. For example, during a research sprint on AI in healthcare, Perplexity’s real-time data highlighted a surge in interest around AI-enabled diagnostics. This insight pointed to a growing focus on innovation in medical technology, which aligned with broader industry trends.

AI’s ability to parse vast datasets and highlight subtle patterns is like having a superpower—it amplifies our ability to anticipate where the puck is going, not just where it is. Combining insights from multiple AI tools can paint a richer picture of market trajectories, helping us make more informed strategic decisions.

Reducing Bias: Leveling the Playing Field

Unconscious bias is a challenge in venture capital, but AI offers ways to mitigate it. By focusing on data-driven metrics, AI helps ensure startups are evaluated based on their merits rather than superficial factors. For example, our initial screenings often use standardized scoring systems powered by AI, enabling us to prioritize companies with the strongest fundamentals. While human judgment remains crucial, AI acts as a safeguard against biases we might not even realize we have.

Additionally, AI can analyze historical investment data to detect patterns of bias and offer alternative perspectives. This creates opportunities to refine our evaluation processes, making them more inclusive and equitable. In this way, AI doesn’t just level the playing field; it helps us see the full spectrum of potential opportunities.

Building Relationships with LPs: Smarter, Not Colder

AI is transforming not only how we evaluate startups but also how we communicate with Limited Partners (LPs). Tools like Affinity help track relationship health, while AI-powered dashboards make it easier to provide LPs with real-time performance updates. Instead of a one-size-fits-all report, LPs can explore data tailored to their interests, deepening their engagement and trust.

One particularly valuable feature is the ability to customize communications. By analyzing LP preferences and past interactions, AI can help tailor updates that resonate on an individual level. For instance, an LP with a focus on sustainability could receive a report highlighting the environmental impact metrics of relevant portfolio companies. This level of personalization strengthens relationships and demonstrates a more profound commitment to transparency.

Looking Ahead: The Future of AI in Venture Capital

As I look to the future, the possibilities for AI in VC seem endless. Imagine AI models that not only predict exit opportunities but also simulate entire market scenarios, helping us craft smarter strategies. Or tools that continuously learn from past investments, refining our approach with every deal.

AI could also revolutionize collaborative decision-making. By integrating AI insights into team discussions, we could enhance the collective intelligence of investment teams, ensuring that robust data support diverse perspectives. This fusion of human and machine intelligence represents an exciting frontier for the industry.

At the same time, it’s clear that AI is a tool, not a replacement for the human side of venture capital. Relationships, intuition, and creativity will always be at the heart of what we do. The challenge—and opportunity—is to balance these elements, using AI to amplify our impact while staying true to the art of investing.

Final Thoughts

As an early-career professional, I’ve seen firsthand how AI is reshaping venture capital. It’s not about replacing people—it’s about empowering us to do our jobs better. By embracing AI thoughtfully and ethically, we can unlock new levels of efficiency, fairness, and insight, setting the stage for a more innovative and inclusive future in venture capital.

At Boomerang Ventures, where we tackle the complexities of healthcare with a small but dedicated team, AI has become a critical enabler. From streamlining workflows to uncovering opportunities that align with our mission, these tools make our lives easier and our impact greater. The journey of integrating AI is just beginning, and its transformative potential is both exciting and humbling. By staying curious, adaptable, and human-centered, we can harness AI’s capabilities to navigate the complexities of venture capital with greater clarity and impact than ever before.

About the Author: Tejas Vijh is an Investor at Boomerang Ventures, focusing on early-stage investments in Health Tech. His experience spans roles at New York Angels, Big Idea Ventures, and Owl Ventures, where he honed his skills in startup evaluation, due diligence, and strategic investments. Tejas holds an MS in Business Analytics from Columbia University and a B. Tech in Computer Science. During his time at Columbia, he founded the Columbia Venture Society to connect students with the venture capital ecosystem. He is deeply passionate about fostering innovation, empowering entrepreneurs, and driving impactful solutions through technology.