Jon Callaghan, co-founder of True Ventures, believes that within five years, our use of smartphones will drastically change, and they might even become obsolete in a decade.
For a venture capitalist whose firm has celebrated significant successes over two decades—including consumer brands like Fitbit, Ring, and Peloton, alongside enterprise software providers such as HashiCorp and Duo Security—this isn’t mere speculation; it’s a core investment strategy True Ventures is actively pursuing.
True Ventures has not achieved its current standing by conforming to industry norms. The Bay Area-based firm has largely operated discreetly, despite managing approximately $4 billion in assets across 12 primary seed funds and four “select” funds used for follow-on investments in high-potential portfolio companies. While many VCs have amplified their public presence through social media and podcasts to attract entrepreneurs and deal flow, True has taken the opposite path, quietly nurturing a close-knit community of recurring founders. This approach appears effective: Callaghan notes that the firm boasts 63 profitable exits and seven IPOs from a portfolio of around 300 companies built over its 20-year history.
According to Callaghan, three of True’s four recent exits in the fourth quarter of 2025 involved founders who returned to partner with the firm again after previous successful ventures. Nevertheless, it’s Callaghan’s forward-thinking perspective on the evolution of human-computer interaction that truly stands out amidst the prevalent AI excitement and massive funding rounds.
“We won’t be using iPhones in a decade,” Callaghan declares plainly. “I’m inclined to think we won’t even be using them in five years—or, to phrase it more cautiously, we will be using them in fundamentally different ways.”
His rationale is straightforward: current phones are poor conduits for interaction between humans and artificial intelligence. “The current routine of pulling them out to send a text, confirm something, send a message, or write an email is incredibly inefficient, and not an ideal interface,” he elaborates. “[They’re] susceptible to errors and disruptive to our daily lives.”
So confident is he in this outlook that True has dedicated years to investigating alternative interfaces—spanning software, hardware, and everything in between. This is the same intuition that led True to back Fitbit early on before wearables gained widespread acceptance, to invest in Peloton after numerous other VCs declined, and to support Ring when its founder, Jamie Siminoff, repeatedly faced financial struggles and was even rejected by “Shark Tank” judges. Each investment initially appeared risky, Callaghan observes. Each time, the wager was on a novel method for humans to engage with technology that felt more intuitive than preceding options.
The newest embodiment of this investment thesis is Sandbar, a hardware device Callaghan terms a “thought companion” — or, more simply, a voice-activated ring worn on the index finger. Its singular function is to capture and organize thoughts via voice notes. It doesn’t aim to be another Humane AI Pin or to rival Oura’s health tracking capabilities. “It excels at one task,” Callaghan states. “But that one task addresses a fundamental human behavioral need currently unmet by technology.”
The objective isn’t to passively record ambient sounds, but to be readily available when an idea emerges, or when important gossip or new information reaches the wearer that they wish to recall. It integrates with an app, leverages AI, and, according to Callaghan, embodies a profoundly different philosophy regarding how we should interact with intelligence.
However, what attracted True to Sandbar founders Mina Fahmi and Kirak Hong extended beyond just the product. “When we met Mina, our visions were perfectly aligned,” Callaghan recollects. True’s team had evaluated numerous teams developing alternative interfaces. But the approach of Fahmi and Hong—who previously collaborated on neural interfaces at CTRL-Labs, a startup acquired by Meta in 2019—distinguished itself. “It’s about what [the ring] facilitates. It’s about the behavior it enables that we will very quickly realize we cannot live without.”
This resonates with Callaghan’s long-standing statement about Peloton: “It’s not just about the bike.” For some, the bike—even its earliest version—was compelling. Yet, Peloton was fundamentally about the behavior it fostered and the community it built; the bike merely served as the vehicle.
This philosophy of backing new behaviors—rather than simply new devices—also clarifies how True has managed to maintain capital discipline. Even as AI startups secure hundreds of millions at unicorn valuations right from the start, True asserts its ability to excel at its core business: writing seed checks ranging from $3 million to $6 million for 15% to 20% ownership in startups it often discovers first.
Callaghan states that True will raise additional capital to support successful ventures, but he has no interest in raising billions of dollars. “Why? You don’t need that much to create something extraordinary today.”
This same careful approach influences his perspective on the broader AI surge. While he acknowledges (when prompted) his belief that OpenAI could soon reach a trillion-dollar valuation and calls this the most potent computing wave we’ve witnessed, Callaghan also identifies warning signs in the circular financing arrangements supporting hyperscalers and their projected $5 trillion in CapEx spending on data centers and chips. “We are in a very capital-intensive phase of the cycle, and that is concerning,” he observes.
That said, he remains optimistic about the true opportunities. Callaghan believes the most significant value creation is yet to come—not within the infrastructure layer, but in the application layer, where novel interfaces will unlock entirely new behaviors.
It all circles back to his fundamental investing philosophy, which sounds almost poetic—the kind of perfectly crafted VC wisdom that might seem insincere from most people: “It should be daunting and isolating, and you should be labeled eccentric,” Callaghan says regarding early-stage investing executed correctly. “And it should be very vague and uncertain, but you should be with a team you genuinely trust.” Five to ten years later, he suggests, you’ll discover if your instincts were correct.
Regardless, given True’s history of backing hardware that many others overlooked—fitness trackers, connected bicycles, smart doorbells, and now thought-capturing rings—it’s prudent to heed Callaghan’s prediction that the smartphone’s era is drawing to a close. Being ahead of the curve is the objective—and market trends support his theory: the smartphone market is largely saturated, growing at merely 2% annually, while wearables—smartwatches, rings, and voice-enabled devices—are expanding at double-digit rates.
A shift is occurring in how we desire to interact with technology, and True is making its investments accordingly.
This article initially misrepresented True’s assets under management (our apologies). Pictured above is Sandbar’s Stream ring. For a more extensive discussion with Callaghan, be sure to listen to the StrictlyVC Download podcast next week; new episodes are released every Tuesday.