I only invest in public stocks and bitcoin. That’s partly because I have access to public stocks only and partly because I am not qualified for venture investments. At least not yet! I don’t do ICOs either. Props to you if you are holding bags! But, I have been a student of venture capital for almost four years now. I first came across the ideas of private markets and venture capital in 2014 in a WSJ story in which this guy named Bill Gurley was sounding alarm about high valuations. I had no idea who Benchmark was back then. I have followed venture capital every since. I have worked on investment teams at Sogal Ventures, Betaworks, Human Ventures and Science over past 3 years. Just as an intern or an associate, nothing too glamorous.
Semil Shah wrote about the new crop of Series A firms and Eric Feng did a very comprehensive analysis of the current venture landscape. Not that it matters in any meaningful way but those two blog posts got me thinking about the kinds of approaches I am rooting for and find fascinating in very broad strokes when it comes to investing in startups in an era where a lot of money is flowing in from all the corners of the world into the US startup scene.
I like the crop of fund managers who are honestly identifying their strengths and have a very narrow focus on what kind of business models could leverage those strengths to differentiate themselves in an extremely competitive market where everyone selling green paper is a #ValueAddInvestor. A very new fund in this category is Wave Capital. They are focusing on marketplaces in certain geographies and alum networks drawing from their data science, venture capital & M&A experiences at Airbnb, FB, Rover, Dropbox & early stage funds.
Another such fund is Forerunner. They just announced a new bigger fund. Over the years, they seem to have expanded their scope beyond what just strictly falls in DTC retail. But, it still is a good example of entering the market with a very narrow differentiated focus. ICYMI, here are my thoughts on DTC retail.
Now, jury is obviously out on how this new category is doing numbers-wise and I am not qualified enough to comment or predict on that front.