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December 17 · Issue #40 · View online
The Future of Venture Capital
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đđ» Happy Sunday! Thank you to the 50 (!!) or so who reached out to me last week with thoughts, suggestions and encouragement. I was honestly touched by just how many of you took the time to email me, I promise to never moan about subscriber numbers again đŹ Your feedback was clear: Shorter, more focused curation + more analysis. The first two should make the latter possible, so I will be attempting this properly from the new year after I (hopefully) feel more refreshed after the Christmas break (and attempting the former today) Also, a reminder that this will be the last Series F until January 7th. I hope you all have a good holiday and thanks for reading, letâs get to it! đ
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Three places outside of traditional venture funding where Peter Diamandis is seeing an growing abundance of capital ~> Abundance of Capital
âSince Steve Cohen quietly launched Point72 Ventures last year, he has invested a small fraction of his $13 billion fortune in 13 early-stage fintech startups. But itâs not VC returns the hedge fund billionaire is most interested in, according to three people who have worked with his VC partnersâ ~>Â Behind Hedge Fund Billionaire Steve Cohenâs Fintech Investments
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âThe bottom line is that the VC community is an increasingly predictable and lookalike bunch that just seems to follow each other around from one trivial idea to another. That was confirmed by an analysis we published today with The Information. My conclusion is that we need to improve decision-making or change the decision makers within our industryâ ~>Â Bros Funding Bros: Whatâs Wrong with Venture Capital
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Almost exactly two years ago, the venture firm Andreessen Horowitz took the wraps off a $200 million âbiofundâ that aimed to invest at the intersection of biology and engineering and was being led by its (then) new general partner, Vijay Pande. Pande argued at the time that it was finally possible to invest in software-enabled biotech ideas â without having to wait eons for them to pan out â thanks largely to the growing ubiquity of machine learning and the falling cost of computing. Evidently, that experiment is playing out as planned. Now, the firm is announcing a $450 million second fund led by Pande â formerly a Stanford chemistry professor â and Jorge Conde, a serial entrepreneur who officially joined the firm a few months ago as a general partner ~> Andreessen Horowitz has a new, $450 million bio fund
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âThe problem arises when multiples are inferred from incomplete data. Itâs quite rare that anybody but the fund manager actually knows the dollars out and dollars returned by a specific investment. And if you have incomplete data, there are usually a number of things that go into calculating or estimating the return. Here are a few other things to think aboutâ ~>Â How Hard Is It to Generate a 10X Return on an Investment?
âMoats protect you from competition, but they also cut you off from the outside world. To create a defensible business today, your product needs to be a utility. You have to build something that solves a user pain, and then scale until itâs so fundamental that it becomes a feature of other productsâ ~>Â Units of Time are the New Currency
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All feedback (still) gladly received on neil@thenordicweb.com or @neilswmurray and see you all in 2018! đ„
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