Jon Callaghan, co-founder of True Ventures, forecasts that in five years, our use of smartphones will vastly change — and perhaps will be obsolete in a decade.

For a venture capitalist whose firm has seen significant successes over 20 years — with consumer brands like Fitbit, Ring, and Peloton, to enterprise software companies like HashiCorp and Duo Security — this isn’t just idle speculation; it’s a principle on which True Ventures is presently betting.

True has reached this point by not adhering to mainstream trends. The Bay Area firm has mostly functioned away from the spotlight, despite overseeing around $6 billion across 12 main seed funds and four “select” opportunity-style funds to inject additional capital into growing portfolio companies. While other VCs have become more promotional — building personal brands via social media and podcasts to entice founders and deal flow — True has chosen a more discreet path, steadily nurturing a close-knit network of repeat founders. This approach appears to be effective: Callaghan notes that the firm has achieved 63 exits with profits and seven IPOs among a portfolio of about 300 companies accumulated throughout its two-decade journey.

According to Callaghan, three of True’s four recent exits in the last quarter of 2025 involved repeat founders who returned to collaborate with the firm after past achievements. Nonetheless, it’s Callaghan’s perspective on the future of human-computer interaction that truly distinguishes him amid the buzz around AI and substantial funding rounds.

“In 10 years, iPhones will not exist,” Callaghan states unequivocally. “I doubt we’ll still be using them in five years — or let’s phrase it a bit more conservatively — we’ll utilize them in significantly different manners.”

His reasoning is straightforward: our phones are poor at bridging the gap between human interaction and intelligence. “The way we currently pull them out to send a text to confirm something or to convey a message or write an email — [that’s] incredibly inefficient, [and] an inadequate interface,” he elaborates. “[They’re] susceptible to errors, disrupting [our] daily lives.”

So convinced is he of this that True has invested years into discovering alternative interfaces — whether software-based, hardware-based, or a mix. This aligns with the same intuition that prompted True to invest early in Fitbit before wearables became mainstream, to support Peloton even after numerous other VCs declined, and to back Ring when founder Jamie Siminoff faced financial difficulties and received rejection from “Shark Tank” judges. Each instance raised doubts, as per Callaghan. Each time, the investment represented a novel method for humans to engage with technology that seemed more organic than prior options.

The latest embodiment of this theory is Sandbar, a hardware gadget that Callaghan refers to as a “thought companion” — or, in simpler terms, a voice-activated ring worn on the index finger. Its sole function: to capture and organize your thoughts via voice notes. It’s not designed to rival Humane AI Pin or Oura’s health tracking. “It excels at one task,” Callaghan states. “That single task addresses a fundamental human behavioral requirement that technology currently lacks.”

The intention is not merely to passively capture ambient sound but to be readily available when an idea arises, acting as a kind of cognitive partner. It connects to an app, employs AI, and, as Callaghan asserts, signifies a distinctly different ideology regarding our interaction with intelligence.

What attracted True to the Sandbar creators Mina Fahmi and Kirak Hong was not solely the product. “Upon meeting Mina, we discovered we were completely aligned on vision,” Callaghan remembers. True’s team had spent years contemplating alternative interfaces and making strategic investments in that direction. Consequently, they’d engaged with numerous founders. However, the methodology of Fahmi and Hong — who had previously collaborated on neural interfaces at CTRL-Labs, a startup acquired by Meta in 2019 — was remarkable. “It focuses on what [the ring] facilitates. It’s about the behavior it fosters that we will soon realize we can no longer live without.”

This sentiment echoes Callaghan’s well-known remark about Peloton: “It’s not about the bike.” For some, the bike — even in its initial form — was enticing. Yet Peloton fundamentally revolved around the behavior it encouraged and the community it fostered; the bike merely served as a tool.

This perspective of investing in new behaviors — rather than just new gadgets — also clarifies how True has maintained discipline with its capital. Even while AI startups accumulate hundreds of millions at billion-dollar valuations right from the start, True insists on sticking to its strengths, which involve writing seed investments of $3 million to $6 million for 15% to 20% stakes in startups they often encounter first.

Callaghan mentions that True will gather more funds to support what proves successful, but he has no inclination to pursue billions of dollars. “Like, why? You don’t need that to create something extraordinary today.”

That same cautious mindset shapes his perspective on the overarching AI surge. While he acknowledges (when prompted) that he thinks OpenAI could soon achieve a trillion-dollar valuation, and while he describes this as the most potent surge in computing we’ve witnessed, Callaghan observes cautionary signals in the self-reinforcing financing arrangements backing hyperscalers and their anticipated $5 trillion CapEx expenditure on data centers and chips. “We’re in an incredibly capital-intensive phase of the cycle, which is concerning,” he remarks.

Nevertheless, he remains hopeful regarding where the true prospects lie. Callaghan contends that the most significant value generation is still to come — not in the infrastructure layer but within the application layer, where innovative interfaces will facilitate entirely new behaviors.

Ultimately, it returns to his fundamental investing philosophy, which sounds almost poetic — the kind of astute VC insight that might seem insincere from others: “It should feel frightening and isolating and you should be labeled as insane,” Callaghan reflects on effectively executed early-stage investing. “And it should feel really unclear and ambiguous, but you should be part of a team that you genuinely believe in.” Five to ten years later, he asserts, you will realize if you were onto something.

Regardless, based on True’s history of investing in hardware that numerous others overlooked — fitness trackers, connected bikes, smart doorbells, and now thought-capturing rings — it warrants attention when Callaghan predicts the phone will soon become obsolete. Being proactive is crucial — and the trend trajectories validate his claims: the smartphone market is nearly saturated, with growth barely at 2% per year, whereas wearables — smartwatches, rings, and voice-activated devices — are experiencing growth in the double digits.

A transformation is unfolding in how we desire to engage with technology, and True is strategically placing its investments accordingly.

Displayed above is Sandbar’s Stream ring. For further insights from our discussion with Callaghan, don’t miss the upcoming episode of the StrictlyVC Download podcast next week; new episodes are released every Tuesday.