Zavain Dar on Hugging Face, NVIDIA & Why Silicon Valley Should Pay Attention to China

Eric Newcomer (0:00)

What do you think Nvidia sees with this deal?

Zavain Dar (0:02)

I think they now have the most important open source repository in the history of software, and definitely for kind of ML and AI, like a phase shift. There was my life before Transformer models and after, and in a lot of ways, I kind of think of my life before Shanghai 2025 and after Shanghai 2025 The vast majority of human disease should be solved, should be treatable.

And I think we're on that path.

Eric Newcomer (0:25)

Zavain Dar is one of the smartest investors I know. Back when he was at the venture capital for Lux, he helped to invest in Hugging Face long before Nvidia scooped it up for some $13 billion. He unpacks Nvidia's open source end game, China's AI and biotech surge, and whether AI can deliver on its boldest promise yet, designing better drugs and transforming human health. I'm Eric Newcomer, host of this podcast. Go read our Substack at newcomer.co. Let's get into it.

Zavain Dar, welcome to the Newcomer Podcast.

Zavain Dar (0:57)

What's up, Eric? Thanks for having me.

Eric Newcomer (0:58)

Yeah, thrilled to have you. There's so much I want to talk about. You and your firm, Dimension, just went on a journey to China and wrote a note digesting that. You were part of an investment when you were at Lux in Hugging Face, which is this phenomenal, insane exit to Nvidia, something like 12.9 billion plus. Just got announced today. Plus retention. And then you're sort of at the heart of investing in AI companies that are trying to transform science and biology. And that's at the core of some of the biggest promises that the AI industry is making. So I want you to sort of play tour guide a little bit and explain what's going on there and what companies can do and can't do. You're an investor in Coefficient Bio, which I reported sold for something like $400 million to Anthropic early on a great early return for dimension.

Let's start off on Hugging Face, just given it's so fresh in everyone's mind. What did you guys see, you know, Brandon Reeves at Lux invested with you? What did you guys see when you made the investment? And then, yeah, what do you think Nvidia has seen with this deal?

Zavain Dar (2:09)

Yeah.

You know, I think at Lux, we'd been investing in and around kind of ML and AI, really since 2014, around when I joined the firm. A lot of it was spurred by advancements we were watching, at least at that point, just in our backyard in Stanford, with kind of the emergence and maturation and scale of neural nets, which then became kind of deep nets and deep learning.

Hugging Face was a company we had been aware of and had been tracking. It was formerly kind of a chat bot, transitioned into a kind of an open source repo for a transformer model, specifically at that point, not to get too technical BART and BERT models. It was actually sourced by our former partner, Zach Shildor. I think I got an email from Beta Works, if I'm remembering correctly, saying, hey, one of our companies, they used to be a chat bot, they're moving into the enterprise space. It's kind of deep tech and AI. We think Lux might be interested in it. And Zach kind of shared it around internally. Brandon and I raised our hands. Brandon gets truly kind of all of the credit here. He was uniquely the champion, the table pounder, the vociferous that kind of we should be involved. We ended up leading the Series A after spending time with Clem and Julian and Thomas. My memory is that it was a little bit of a competitive Series A, so we kind of took out Clem and Julian to Lucienne, a French bot here in this village, if you've been there. I had cocktails, I had garfunkels, and now defuncts.

Eric Newcomer (3:38)

You're like, I was part of the courting. I was good at a... Kind of, yeah.

That's a good dinner companion.

Zavain Dar (3:44)

Pas français, un typo oui. So you can kind of conversate with the founders in their language quite literally.

Eric Newcomer (3:52)

They'd been in sort of chat bot territory before, right? But they were pretty technical for what they were doing.

Zavain Dar (4:00)

Yeah, I mean, Julian did his grad school in computer science at Stanford. Tamar was a co-politech, computer science PhD. They were amongst some of the earliest true kind of innovators and application engineers atop of transformer models. And so their initial application was more of a chat bot Tamagotchi like thing for kids. Frankly, we met the company after they had already transitioned, but right after they transitioned and what was immediately evident then was just an insane amount of developer, kind of center of gravity, developer pull for what they were kind of tracking. I remember Brandon coming in to a Monday IC and showing kind of the GitHub stars over time for the Hugging Face repo, and it was kind of outpacing any other prior open source repo we had ever seen.