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Series F - Issue #38: The Future of Venture Capital


Series F

December 3 · Issue #38 · View online

The Future of Venture Capital

👋🏻 Happy Sunday everyone! 
The #1 reason for me starting this newsletter was to hold myself accountable for doing the reading I felt was required for someone looking to move into the industry. 
I’ve worked with AngelList to raise an angel fund from 50+ individuals, democratising startup investing in the Nordics and allowing the grassroots ecosystem to support the region’s strongest companies.
Individuals who are contributing to an ecosystem either through community building, hosting meet-ups or by being a current active entrepreneur naturally have the best insight as they are at the grassroots level and regularly come across new startups, projects, ideas and people before other actors higher up the chain. 
Despite this, no investor is currently leveraging this knowledge effectively. The Nordic Web Ventures does so by allowing these individuals to directly back and support these companies.
I’d love to hear your thoughts and feedback on this model! And in the meantime, enjoy this week’s (rather packed) issue!
Curated by @neilswmurray

Upsetting the Apple Cart 🍎
The Nordic Web, a research and analysis company which specialises in covering data on tech companies emerging out of the Nordic region, has started a new Angel fund. The fund will invest across Denmark, Finland, Iceland, Norway and Sweden ~> The Nordic Web launches an Angel fund to find the region’s under-the-radar startups
NFX raised a $150 million fund, supported by some of the world’s most influential entrepreneurs, endowments, foundations, and funds of funds. They’ve set out to transform how true innovators are funded: “The time is now to change how innovators get funded — not just in the interest of founders themselves, but also in the interest of the entire community and the global progress we impact” ~> NFX Launches $150 Million Fund to Transform How True Innovators Are Funded
Neufund opens and re-imagines Initial Coin Offerings (ICOs) for all types of companies and investors. Neufund combines the advantages of the classical equity investment with the efficiency of the ICO fundraising ~> Sneak peak into the Neufund Platform
Online dating removed many of the transaction costs previously involved in finding a partner and we know that these same transaction costs are present when you try to find a cofounder ~> Founders and online dating 
FirstRound released a product called FirstSearch “The best tactical advice in tech”  
New Funds and Models 💸
Canada’s most prolific venture capital firm, Real Ventures, has raised $180-million from investors for two new funds, including backing from international heavyweights Tencent Holdings Ltd. and Singapore sovereign wealth fund Temasek Holdings Private Ltd ~> Foreign funds help Real Ventures raise $180-million for two new capital pools
Episode 1 has been a stalwart of the early-stage funding scene in London for the last few years, investing in successful startups like Carwow, Triptease and AimBrain. It’s now closed its second U.K. “seed-to-Series A” fund, a £60 million ($81 million) Enterprise Capital Fund (ECF), raised with the support of the British Business Bank, the U.K. government’s economic development bank. Many U.K. funds are turning to the BBB in the wake of Brexit, which has effectively switched off the EU funding taps ~> Episode 1 rolls out new $81M seed-to-Series A fund, despite Brexit headwinds
Vertically Speaking 📈
What many innovators and tech entrepreneurs are quickly realising is the immense opportunity for reinvention in just about every industry, by leveraging the blockchain. Here are a few industries that are already being disrupted: The Unexpected Industries About To Be Disrupted By Blockchain Technology
Going forward, an entirely new toolchain is necessary to unlock the potential of ML/AI, to make it operational and usable — let alone approachable — for developers and enterprises. It stands to reason, then, that the next great opportunity in infrastructure will be to provide the building blocks for systems of intelligence ~> Infrastructure 3.0: Building blocks for the AI revolution
(This feels different from what I’m seeing, but hey, I guess data never lies…) Funding for VR and AR startups in 2017 is roughly on par with 2016 levels, a Crunchbase News analysis finds. The year got off to a sluggish start in the first quarter, but investment in the past three quarters has accelerated enough to make up for the deficit ~> Virtual Reality Gets Its Groove Back
Photon-based quantum encryption could help companies better defend against cyberthreats, and it’s one step closer to reality thanks to research from Duke University ~> How quantum computing could create unbreakable encryption and save the future of cybersecurity
Emerging Markets 🌏
In September 2015, the Ukrainian startup community and technology-focused media went into a frenzy after Snapchat announced it was acquiring Looksery, an Odessa-based image-processing startup. Looksery was the first in a series of success stories involving computer vision and facial recognition startups from Eastern Europe ~> Why Eastern Europe is a hotbed for computer vision startups
Europe is making major strides to eliminate barriers that have held back the region from developing tech firms that can compete on the scale of global giants Alphabet Inc’s Google, Inc or Tencent Holdings Inc ~> Does Europe have what it takes to create the next Google? and the original report: The State of European Tech 2017 
While the EIF has played a key role in the development of venture capital in Europe over the past 20 years, there is little information available about its returns. We do not know how the funds launched in a particular year or particular country have performed, and it is only very recently, after persistent prodding, that it has released data on the performance of its overall portfolio ~> Transparency in European venture capital
Crypto-Crazy 🤑
This post describes why blockchain governance design is one of the most important problems out there, its critical components, current approaches, potential future approaches, and concludes with suggestions for the community ~> Blockchain Governance: Programming Our Future
This list highlights some of the investors, technologists, and leaders who are leading the conversation about crypto, and their take on what they’re excited about heading into 2018, and what they’re seeing that concerns them ~> The Future of Crypto Investing: 10 Women to Know
Many technologists think blockchains can revolutionise how we keep track of our identities ~> Blockchains Are Poised to End the Password Era
Nasdaq is hopping on the bitcoin bandwagon. The exchange operator is set to launch a bitcoin futures product next year ~> Nasdaq is set to launch bitcoin futures
The way the bitcoin ecosystem will play out is written in the mathematics of its consensus rules; we should all know the three phases it will go through ~> The Three Economic Eras of Bitcoin
Bank of France governor Francois Villeroy de Galhau has said that Bitcoin is not a currency - and not even a cryptocurrency ~> Bank Of France Governor: Bitcoin ‘Isn’t a Cryptocurrency’
Compelling Visions 🔮
Who, exactly, are the venture firms to pick up on the hottest  trends first? Which investors, as Everett Rogers’s theory of innovation diffusion categorises, are the “innovators,” “early adopters,” and “early majority” for becoming involved in a new technology trend? Ahead Of The Buzzword Curve: Finding Investors In Front Of Top Tech Trends
Since 2014, the number of VC rounds in technology companies worldwide has nearly halved, from 19,000 to 10,000, according to PitchBook. During that time, the drop in VC funding amount has been nowhere near as dramatic, highlighting that VCs are concentrating investment into fewer later-stage companies ~> There’s an implosion of early-stage VC funding, and no one’s talking about it
Index Ventures and Balderton are helping European entrepreneurs with tackling stock options for employees ~> Two giant European VCs want founders to give more equity to employees and here is the tool from Index: OptionPlan 
“Conventional wisdom suggests you should start a company with one of your friends. The relationship between cofounders is crucial. Everyone knows this. Except it’s false” ~> Start a company with a stranger
“If you’re building experiences and looking for word of mouth vitality ask yourself, is your product genuinely fun? It’s the best way to grow” ~> Fun is the best driver of viral growth.
Larry Hatheway, who’s spent decades poring over the mechanics of financial markets and investing, says his two biggest concerns right now are China and inflation ~> Two Biggest Risks Now Are China and Inflation, Market Veteran Says
The one most damaging myth that most VCs believe in ~> The Case Against Pattern Recognition
Seven billion people on this planet share a flaw: They’re out of touch with almost everyone else ~> We’re All Innocently Out of Touch
Christian Hernandez: Why I Venture
Suddenly this slide is in everyone’s decks ~> Tech’s 2017 Slide of the Year
Always Be Closing ☕️
As ever, I’d love to hear from you, not just your thoughts on the newsletter but also in regards to what you are working on!
Reach out to: or @neilswmurray 👋🏻
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