Warren Mercer

@kadar1 Locking in does indeed pay the bills.

Its never been a better time to lock in and focus on the right things. Just have to find the right things to focus on

Any of my security friends at @SANSInstitute CyberThreat in London this week? Hit me up! Be good to see some old faces :)

@hthieblot @jaltma I'd just like the feedback to say why it's a Yes or why it's No when we get them, or a road to a Yes... I get it though they've 100+ deals to go through but it would be beneficial to founders :)

@jaltma This is actually a nightmare scenario for the founders. VCs with such a strong opinion they think they could be running the company

Most VCs should be much less sure of most of their opinions most of the time.

@MartinGTobias I've DM you previously Martin, let's chat. :)

If an investor tells you they want to see a certain revenue growth rate YoY you are not taking to a pre seed investor. You are talking to a seed I’d aeries A. Investor. Call me instead. I wrote the check to this company with less than seed traction growth. AFTER your pre seed yes please grow > 500%

@credistick Raising pre-seed in the UK & EU is ... damn near impossible. We have some committed capital but need to fill our pre-seed round :)

First-check VCs/angels find opportunities in a mostly unexplored pool of potential, rather than the finite number of deals that make it downstream. There is some ceiling to the volume of capital that should be allocated to that part of the market, but it's a long way off; the compounding value is immense. It's clearly also a strategic imperative for government LP initiatives, where existing LPs have fallen into a risk-averse or zero-sum failure mode. The abundance business, described by @adaugelli in "State of the Seed Market":

@ahboyash You really need @kpath_ai on that list @ahboyash :)

AI Agent Interoperability Standards AgentFi standards are quietly becoming the base primitives. Standards are emerging for AI agent communication and commerce (payments), addressing different layers of the interoperability stack. This piece covers 6 major standards that allow for composability → Payments (x402), tools (MCP), checkout (Stripe ACP), coordination (Google A2A), trust (ERC-8004), and verifiable agent commerce (Virtuals ACP). *Do note that all standards carry some amount of risks, from technical vulnerabilities to regulatory uncertainties and this requires careful implementation and ongoing monitoring. - - - - - a) x402: HTTP-Native Payments for AI Agents • x402 revives the long dormant HTTP 402 "Payment Required" status code to enable instant micropayments directly over HTTP without accounts or subscriptions • Developed by @coinbase with the x402 Foundation (partners: @Cloudflare, @Visa, @Google), it addresses the internet's lack of native payment capability and enables payments as low as $0.001 with ~2-second settlement times • The flow: AI agent or user sends standard HTTP request → returns HTTP 402 with with JSON PaymentRequirements specifying amount, network, recipient address, and asset (typically stablecoins, USDC) → client signs payment tx using EIP-3009 (EVM) or SPL (Solana) authorization → which is then verified by the server (locally or facilitator's endpoint) Server Verification → tx is settled and the on-chain confirmation is triggered • The protocol uses ERC-3009 for gasless EVM transfers, enabling clients to pay without holding ETH for gas. • Settlement Times are ~2 seconds on @base (1-3 blocks) and sub-second on @solana with extremely low gas fees (<$0.0001 on Base, ~$0.01 on Solana); gasless for end users and no protocol fees • Some recent integration examples include Cloudflare Agents SDKs (edge compute payments) and @virtuals_io with a 5x increase in agent transactions • Risks: there was a 402bridge hack with the exploit resulting in $18k USDC stolen from users (attackers exploited backend private keys and token approvals to drain funds). There is also AI agent specific risks such as LLM manipulation (prompt injection attacks could expose seed phrases/ private keys or redirect payments to attackers’ address), agents may execute unauthorised transactions if consent mechanisms fail, and backend key management vulnerability • An interesting concern is the AML/KYC requirements where CDP facilitator includes mandatory KYT/OFAC screening for USDC compliance, but x402's pseudonymous nature enables potential money laundering in AI agent transactions. Cross-border micropayments may trigger Money Transmitter License requirements in various jurisdictions. Another question to post is whether stablecoin regulations (MiCA in EU) directly apply to USDC transactions on-chain. • Right now, x402 is limited to Base and Solana, where other chains need to self-host facilitators. EVM chains need EIP-3009 support, limiting token compatibility. There is also heavy reliance on Coinbase CDP and third-party facilitators which creates centralization risks despite a relatively open protocol design b) ERC-8004: Blockchain-Based Trust for AI Agents • ERC-8004 is a @ethereum Improvement Proposal (EIP) extending Google's A2A protocol with blockchain-based trust mechanisms → solves the trust problem through on-chain identity and reputation registries • Three lightweight on-chain registries: >> Identity registry: Portable agent IDs are ERC-721 NFTs linking to off-chain Agent Cards on IPFS (metadata) that store agent details, endpoints, and trust models with cross-chain and ENS/DID support >> Reputation registry: Tracks performance via on-chain feedback scores from verified interactions. Feedback authorization secures reviews with EIP-191/ERC-1271 signatures, stores scores on-chain with IPFS feedback, and uses pre-authorization to prevent spam >> Validation registry: Verification requests let agents submit task hashes for third-party scoring with proof links, supporting both pass/fail and multi-validator evaluations • Interoperability mechanisms include oracle integration @LayerZero_Core, @chainlink CCIP for cross-chain data queries + Wrapped IDs for @solana/ @cosmos • Risks include smart contracts threats like domain squatting, Sybil spam, and oracle tampering, while blockchains add MEV and storage bloat risks Together, x402 and ERC-8004 creates the "ultimate app store" for AI agents on Ethereum → a coordination layer where agents can discover each other through ERC-8004 registries, establish trust through reputation systems, and transact with one another seamlessly through x402 payment rails c) MCP (Model Context Protocol): Universal AI-Tool Integration • Developed by @AnthropicAI, MCP serves as "USB-C for AI," standardising connections between AI apps and external systems through a client-server architecture • The protocol operates in two layers: Data Layer (communication between clients and servers) and the Transport Layer (supports both low-latency local connections via Stdio Transport and remote streaming via HTTP) • Adoption uses cases include @OpenAI (integration across ChatGPT, Agents SDK), @GoogleDeepMind (@GeminiApp models), @Microsoft (@Azure OpenAI Service) and @AnthropicAI (Native @claudeai Desktop integration) • Risks include code execution via local servers to injection and DNS rebinding vulnerabilities. Authentication flaws like static client IDs, excessive permission scopes, and token passthroughs can enable unauthorised access and large-scale breaches. Lastly, privacy leaks and compliance violations expose enterprises to regulatory and supply-chain risks, as seen in real-world MCP and server compromises d) Stripe ACP (Agentic Commerce Protocol): Agent-Driven Commerce • @stripe's ACP is an open-source specification enabling secure, programmatic commerce between AI agents and merchants. • Standardises how agents talk to online stores, manage carts, and pay using temporary encrypted tokens (SPTs) instead of users’ real card details • The flow: AI agent sends checkout request with product intent which the merchant validates and responds with pricing → user selects preferences confirms via agent authorisation → Merchant creates payment intent and confirms order • Security mechanisms include encryption & tokenisation (SPTs encrypt credentials, never expose raw payment data) and authentication (HTTPS + Bearer tokens, HMAC-signed webhooks) • Partnerships include ChatGPT Integration (instant checkout), merchant access (with @Etsy and Shopify) → Stripe implementations could have significant ecosystem advantages with their many partnerships • Risks includes bot manipulation (automated attacks exploiting agent payment flows), social engineering (tricking the AI agent into unauthorised purchases) and unclear ownership/ responsibilities (ambiguous responsibility for AI agent errors) e) Google A2A (Agent2Agent): Multi-Agent Coordination • @Google's Agent2Agent protocol enables opaque AI agent interoperability → a payment-agnostic framework to transact across all types of payment • The goal is to build a shared protocol that provides a common language for secure, compliant transactions between agents and merchants, helping to prevent a fragmented eco • There are over 150+ partner organizations including enterprise SaaS (Adobe, Salesforce, SAP, ServiceNow). Some early implementations include supply chain (Tyson Foods) and enterprise workflows (@Adobe content workflows and @ServiceNow automation) • Security and attack vectors include identity attacks like agent card spoofing (malicious servers impersonating legitimate agents) and protocol level vulnerabilities (rug pulls, context positioning and redirection of workflows). There is also the case where it leads to protocol fragmentation (many different standards creating ecosystem fragmentation) f) Virtuals ACP (Agent Commerce Protocol): Verifiable Agent Transactions • @virtuals_io’s (ACP) creates a decentralised infrastructure where autonomous AI agents operate as tokenised, revenue-generating economic entities. • The platform integrates multiple components for comprehensive agent lifecycle management: >> The platform unifies agent lifecycle management through a 4-phase workflow → request, negotiation, transaction, and evaluation. All this is governed by the GAME framework that separates reasoning from execution >> It integrates on-chain registries, tokenised agent entities, and SDKs for social and custom domains, with off-chain AI inference tied to on-chain settlements. >> Operates primarily on Base and Ethereum L2s, it relies on ACP smart contracts, DEXs, and LLMs to handle cross-chain value flow and cognition • Ecosystem wise, Virtuals has been performing quite well with a total ecosystem value hitting ~$2b (agents + protocol) with top performing agents in $TIBBIR and $AIXBT • Risks include AI reasoning gaps, hallucination errors, and reliance on off-chain inference that could disrupt agent coordination, limited agent adoption, and over reliance on Base and evolving LLM capabilities - - - - - The AI agent interoperability landscape so far represents a similar moment that can be comped to the early internet's protocol wars. Each standard addresses different aspects of the agent economy stack, with varying maturity levels and risk profiles. I would say the more “Production-Ready” standards (x402, MCP, Stripe ACP, A2A) have so far demonstrated real traction but face significant challenges: x402's security vulnerabilities, MCP's performance overhead and A2A's scaling issues suggest optimisation needs. Emerging standards (ERC-8004, Virtuals ACP) offer unique value propositions through trustless mechanisms and tokenisation, but face fundamental scalability (adoption and traction) and cost barriers. My take is that successful AI agent implementations will likely require a multi-protocol approach → for example using x402 for payments, MCP for tool integration, ACP for commerce, A2A for coordination, and blockchain protocols for trust and tokenisation. - - - - - This piece was inspired by my smarter and more technical friends @yq_acc and @superoo7 who have put out great content on this vertical.

@patmatthews @Rackspace We did but I didn't realise you guys only did US Companies.

Sequoia funded @Rackspace. Absolute GOATs. But if you can’t get them interested in your small pre-seed round, give us a call!

@PLBompard Search. Trust. Agentic Web. @kpath_ai kpath.ai 🙏🏻

Pitch your startup - Max 5 words - Link if ready 👀 Seen by 140k people last month 📈 YES, it counts as marketing - GO!

@mashadrokova Leaving all us pre-seed small guys out of the stable :)

The thing that makes me mad most is that bad teams with fancy logos on cap table and eight figures seed raise steal great talent from true builders and as a result we all move slower

@yanatweets @a16z Come see @kpath_ai - you'll make a quick decision on the future with us.

I invest like a founder: Fast 💨 My 2nd investment as an @a16z scout is closing. The best founders move at the speed of light. If you want to be on their journey, you need to keep up. My goal is to make investment decisions within 24 hrs. For this one, I decided in 0 hrs, asking to invest during the call. I was the first check in. Both for this deal and the next one in my pipeline. Unlike most investors, I don’t need to see others invest to build conviction. Still working through 150+ pitches I got after announcing the first investment. As a founder, I’ve built in public. Now I’m trying something new: “investing in public.” Pitch me more!!

@ChrisJBakke I don't think I've felt more seen, Chris.

*open app* "We've just raised a $50M pre-seed to help your toaster talk to your microwave." "We just raised a $230M pre-pre seed to agenticly agent your AI agents." "I'm 4 and I just dropped out of preschool to go all-in on AI -enabled candles." *close app*

@christophersaum Following the VIX during these "bubbles" and "disasters" is always fun :)

Anyone trying to short this bubble is going head to head with a 30 year hedge fund manager in Bessent. 6:30am announcement this morning when we were below the expected move with a VIX at 30 on a friday of opex. Bessent knew…

@bhalligan Would love to show you what we're building @kpath_ai, Brian. It's compelling.

I've looked at a lot of AI startups recently at the app/agent layer. My take: Everyone's building the same stuff.

@christophersaum I still gotta show you that demo ;) let’s connect please.

Just left an awesome SF demo day where the founders were cracked (did I nail that buzzword or nah? ) But by the time they hit the stage, it’s too late for us given valuation/ownership/round size. We are designed to be part of the first million into a business. I have realized that I have to find these founders before demo day. @fdotinc, @LeapYear, @TheResidency, & what @tommypotter’s retreats offer are solid starting points... but I know there are more hidden corners with incredible founders. Where y’all hanging?

@christophersaum Come see the @kpath_ai demo anytime :)

5 founder meetings today. Asked for demos in 2 of them. Both didn't work. Not a dealbreaker, but always be ready to demo. Having it ready is such an easy way to show you're prepared and technical execution matters. Small details, big impressions.

@jackforestell @Visa Hey Jack, let’s talk :)

AI commerce is accelerating. We have 30 partners in our @Visa Intelligent Commerce sandbox and 4 pilots underway shaping the future of agent-powered payments. We’re welcoming an era of trusted, intelligent commerce where agents act on your behalf.

I recently joined @GoldmanSachs’ Will Nance at the Communacopia + Technology Conference. We dug deep into several topics, including @Visa's move towards 100% tokenization and driving AI-powered commerce.

if you think no one will fund you, you’re right. if you think everyone should, you’re right. if you think the right vc will get it before anyone else does… …you’re also right. that’s me. dm me what ur building and I’ll respond with my raw thoughts.

@thejesonlee Wait. You’re telling me an MBA doesn’t place them on a qualified position to judge my startup?! Well I’ll be……….

Because majority of the team at big VCs are made up of non-technical / career VC / MBA / PE folks who can’t build conviction without their spreadsheet.

@bonatsos It’s hard. There is sometimes rationale you don’t agree with whilst also fighting back the positivity from the VC/Investors you’re dealing with. Rollercoaster meetings galore :)

I see so many first time founders giving up too soon.  The biggest mistake a founder can make is giving up too soon.