Manufacturing Outliers: Long Lake

Some of the best companies we've backed at General Catalyst didn't fit neatly into an existing category when they were first imagined. The Creation strategy exists to back builders who can see how the world is changing before there is a name for what they're building. Our story with Long Lake started as conversations between friends Alex Taubman and Marc Bhargava and soon included Hemant Taneja, Ken Chenault, and the broader GC team in an effort to build the next generation AI-enabled compounder.

All of our Creation opportunities are built around what we see as exceptional talent. Alex Taubman was one of the youngest Managing Directors at Oaktree and in parallel ran a family investment vehicle focused on smaller founder- and family-owned services businesses. He knew how to spot a great business, structure a transaction, and lead a company through its next chapter.

General Catalyst was seeing AI transformation at four layers: chips/hardware, infrastructure, models, and the application layer. While portfolio companies such as Ramp and Glean were tapping into the application layer, there remained a wide opening to bring AI to a broader piece of the economy, especially to services businesses. Over time, what we learned from GC’s investment and work with frontier models such as Anthropic allowed us to support Long Lake in bringing forefront technology to new industries.

We believe Long Lake was the first expression of the “AI roll-up” as a concept. Alex and the GC team were convinced of a massive opportunity to bring AI to a part of the economy that needed it. We see services businesses as a driving force in the global economy, but they are often fragmented, underleveraged, and in most cases running on the same manual processes they used over a decade ago. We believe that AI can bring abundance to the massive services industries.

While private equity has long understood that you could roll up services players and create value through scale and operational discipline, we believe that applied AI could do even more than improve cost structures, and instead fundamentally change the growth profile and what companies could deliver for their customers. 

The ambition was to build a new generation of AI native compounders, drawing inspiration from public consolidators like Constellation Software or Danaher. In February 2024, GC’s Creation strategy led the first investment into Long Lake, setting up the structure and conviction to double down as the company proved out the model. It was the kind of financing the Creation team was built for, combining venture-style partnership with deal construction to fund significant M&A in a way that didn't fit any existing category. 

Scaling Long Lake

In the two and a half years since, Long Lake has completed 40 acquisitions and built a proprietary AI platform, Nexus, deployed across every company it owns.

The results Long Lake reports from Nexus produces are specific and measurable. In Residential Services, it generates entire board packets and financial reports in seconds — tasks that previously consumed days. Top-performing HOA managers are reclaiming over 65 hours per month. An AI-powered sales engine has grown the new customer pipeline tenfold. In Business Services, Nexus handles payroll processing with automated exception flagging and resolution, delivering a 30%+ capacity increase for payroll processors, meaning the same team can serve a materially larger book of business. 

Critically, this is not a story about replacing workers. We see it as a story about making workers dramatically more capable and then deploying more of them. As AI handles administrative and repetitive tasks, Long Lake's businesses can serve more clients, grow faster, and do more for the customers they already have. AI-powered sales tools that free up salespeople can lead to bigger and more successful sales teams. Efficiency gains that reduce cost per transaction can lead to margin expansion and new hiring. Long Lake is net adding jobs across its portfolio, while delivering more access and better products to hundreds of thousands of end users.

The result, we believe, is a flywheel. Long Lake acquires high-quality services businesses with strong customer relationships, recurring revenue, and genuine data and distribution advantages. It deploys Nexus to drive organic growth and margin expansion. It uses those improved economics to fund more acquisitions, each of which can contribute new proprietary data and new domain-specific workflows that can make the platform more powerful for every company in the portfolio. Over time, the goal is for the AI to compound in capability, and the M&A machine to compound in target precision.

The team executing this is exceptional. The engineering team brings experience from Palantir, OpenAI, Glean, Ramp, Google, Scale AI, and more. The M&A team draws from Goldman Sachs, TPG, Blackstone, GTCR, and Oaktree. Operations leaders come from McKinsey, BCG, Insight Partners, and Airbnb. It is one of the most interdisciplinary and high-caliber teams we have backed — technology, dealmaking, and operations working in concert. 

The Next Chapter

Today, Long Lake is announcing the close of the take-private of the world's leading corporate travel management company, Amex GBT. It is the largest and most transformative acquisition in Long Lake's history. The General Catalyst team, led by Madhu Namburi and Ken Chenault, worked closely to support the transaction.

We believe that Amex GBT is a true category leader: a legacy franchise and the #1 global business-to-business travel management platform. The business is built on deep, long-tenured relationships with enterprises that trust it to manage their travel programs, as well as with the airlines, hotels, and suppliers whose inventory it distributes. Those relationships, built over decades, are hard to replicate or displace. But the workflows sitting underneath them — bookings, changes, cancellations, disruptions — largely remain manual. Long Lake’s Nexus can automate the repetitive, high-volume work that consumes travel agents today, freeing them to focus on the complex, relationship-intensive moments that have built their relationships moat. Our aim is that travelers get a better experience, the business scales, and Long Lake works toward transforming service categories and bringing the benefits of AI to the broader global economy.

Long Lake has proven it can acquire good businesses and in our view make them measurably better with AI. We have been with them at every stage: from the first investment, before “AI rollups” was a recognized concept, through 40 acquisitions that helped define what we believe can become an entirely new asset class. We believe the early results support the thesis, and we have never been more confident in the team, the platform, or the opportunity ahead.