This was such an amazing read and validated by thesis that you surely are the first person I would want investing in what my team and I are building at AETTHER.
Whether it be $5, or $Trillion, I definitely want you on my team as well!
The time for AI + AR + IOT is NOW!, I call it AIRT for Artistic community engagements that bridge the online to onsite experiences through an ART remix engine and IOT Token Network. This has been 14 years in the making, as it required a new but familair token network built on top of Aeternity (NFT + IOT Oracles), Bitcoin (IOT Currency), and Coinbase (IOT DEX) ... Also, its no suprise Aeternity has AI and AR in it, while Bitcoin has IOT in it!
Let's get it. Sending lightweight pitch deck right away!
Interesting article, although I’m not sure I agree with the ‘no brainer’ part.
While “Nothing kills deals like more time and more data” is certainly true, it’s also not necessarily a bad thing. Because there’s already a long list of investment frauds and managed failures where the only people making bank were the founder(s), all made possible because investors had such ‘no brainer’ moments and forewent all due diligence based on the supposed “investable-ness” of the founders. When it turned out that their “specialness” was really just their ability to sell their investors down a river. And those aren’t exactly rare occurrences in the world of Venture Capital.
To me as founder, frankly any investor willing to invest solely based on my personality and irrespective of the merits of my actual ideas/business would raise a huge red flag and very likely would make me walk away. I do want to see my ideas and my concepts to undergo at least some scrutiny, because it shows me that the person who might become my new business partner is taking this seriously, and at least tries to understand the details of the business they might soon own a share of. It also shows me whether this prospective business partner truly understands my sectors (DeepTech/DefTech/Aerospace) and the specific challenges it poses to startups like mine (it’s absolutely staggering how many don’t).
At the end of the day, accepting an investment isn’t just taking a check, it’s most of all entering a long-term business relationship with someone who’ll own a share of my business (the check is merely the facilitator). Both sides have to be confident they can work together productively, and that’s not possible without at least some level of scrutiny from both sides (I wouldn't enter into a deal without scrutinizing the prospective partner) . Without this, it’s really just a waste of everyone’s time.
The aspiration of true partnership should always be front and center, and "Magic" doesn't mean I don't understand their business. It means I understand their unique insight, and believe they have a shot.
However, sometimes it shouldnt be about the idea at all. Good people at the earliest stages.
Irina, actually, I was talking about early stage/pre-seed. Which, as far as due diligence is concerned, really only differs from later stages in that there is a lot less data to go through. Still, it doesn't mean it's a good idea to completely forego it.
It’s also worth remembering that the article was specifically talking about DeepTech, not run-of-the-mill startups like another SaaS or services business. DeepTech/FrontierTech addresses big problems on a global scale and has regularly very high costs of entry, which preclude bootstrapping unless the founder happens to be very rich already. And even at “very early stage” investments are often still in the Millions of $. While founder personality definitely plays a huge and critical part in a startup’s success and can make or break a business, making investment decisions solely by personality and ignoring the actual business aspects doesn't seem like a sane strategy in a capital intensive field like DeepTech.
If we were talking about regular startups then I’d agree, at early stage the business idea doesn’t really matter much (it’s likely to pivot anyways). But monuments are different than lift & shift.
Deep Tech vs. things that have a previous playbook are different in a few ways, but at the beginning - they all are two people and a dog.
The difference between early stage and later stage to me are very different: The optimization of luck vs the optimization of access.
Making investment decisions with the belief their personality build a big company does seem to be a good filter to me. However, there are many ways to make money in venture capital. All my stuff is geared toward super early stage.
As mentioned, I certainly agree regarding the importance of founder personality, especially at early stage. And naturally, the earlier the stage the more important founder personality is vs other elements. Th contentious element is whether personality alone is enough to make an investment decision, as suggested in the article.
Let’s say you meet a really great founder (ticks all the boxes you’re looking for in a founder) who’s looking for an investment for a great startup idea (the next big thing of something), so you invest.
Now let’s assume you meet the same great founder but now he’s looking for investment into an idea which is terrible. Would you still invest? His personality makes him a ‘no brainer’ from the article but the business idea is so bad you’re almost guaranteed to lose your investment.
Finally, you meet the same great founder but this time he’s has no real idea but he has registered a business and now he’s looking for an investor so he can spend time on finding a great idea for his business. Would you still invest? Again, he’s still one of those ‘no brainers’ from the article but at the time of investing you have no idea what he picks for an idea (or any, for that matter, before burning through your investment).
My point is that, while personality is important, the actual idea/business concept has to be part of an investment decision, at least to some extend. Sometimes, things that look great from one side of the table don’t appear the same when looking at them from the other side, and to me the 'no brainer' part of the article is one of these things (and I’m saying this as someone who actually walked away from a potential deal because of a similar issue).
This was such an amazing read and validated by thesis that you surely are the first person I would want investing in what my team and I are building at AETTHER.
Whether it be $5, or $Trillion, I definitely want you on my team as well!
The time for AI + AR + IOT is NOW!, I call it AIRT for Artistic community engagements that bridge the online to onsite experiences through an ART remix engine and IOT Token Network. This has been 14 years in the making, as it required a new but familair token network built on top of Aeternity (NFT + IOT Oracles), Bitcoin (IOT Currency), and Coinbase (IOT DEX) ... Also, its no suprise Aeternity has AI and AR in it, while Bitcoin has IOT in it!
Let's get it. Sending lightweight pitch deck right away!
Interesting article, although I’m not sure I agree with the ‘no brainer’ part.
While “Nothing kills deals like more time and more data” is certainly true, it’s also not necessarily a bad thing. Because there’s already a long list of investment frauds and managed failures where the only people making bank were the founder(s), all made possible because investors had such ‘no brainer’ moments and forewent all due diligence based on the supposed “investable-ness” of the founders. When it turned out that their “specialness” was really just their ability to sell their investors down a river. And those aren’t exactly rare occurrences in the world of Venture Capital.
To me as founder, frankly any investor willing to invest solely based on my personality and irrespective of the merits of my actual ideas/business would raise a huge red flag and very likely would make me walk away. I do want to see my ideas and my concepts to undergo at least some scrutiny, because it shows me that the person who might become my new business partner is taking this seriously, and at least tries to understand the details of the business they might soon own a share of. It also shows me whether this prospective business partner truly understands my sectors (DeepTech/DefTech/Aerospace) and the specific challenges it poses to startups like mine (it’s absolutely staggering how many don’t).
At the end of the day, accepting an investment isn’t just taking a check, it’s most of all entering a long-term business relationship with someone who’ll own a share of my business (the check is merely the facilitator). Both sides have to be confident they can work together productively, and that’s not possible without at least some level of scrutiny from both sides (I wouldn't enter into a deal without scrutinizing the prospective partner) . Without this, it’s really just a waste of everyone’s time.
The aspiration of true partnership should always be front and center, and "Magic" doesn't mean I don't understand their business. It means I understand their unique insight, and believe they have a shot.
However, sometimes it shouldnt be about the idea at all. Good people at the earliest stages.
Yes, that makes sense. It just didn't come across this way in the article.
Benjamin. Adam is talking about early stage, Angel or Pre-Seed.
I agree with his thesis and No-Brainers is strong positive signal ( rare find too)
I think you are talking more of a later stage due diligence for companies that are raising SEED+ …
For sure the market have been witnessing what appears as No-Brainer decision by funds/investors deploying capital in scale-ups+ stage companies.
Early stage investment decision making is different…
Irina, actually, I was talking about early stage/pre-seed. Which, as far as due diligence is concerned, really only differs from later stages in that there is a lot less data to go through. Still, it doesn't mean it's a good idea to completely forego it.
It’s also worth remembering that the article was specifically talking about DeepTech, not run-of-the-mill startups like another SaaS or services business. DeepTech/FrontierTech addresses big problems on a global scale and has regularly very high costs of entry, which preclude bootstrapping unless the founder happens to be very rich already. And even at “very early stage” investments are often still in the Millions of $. While founder personality definitely plays a huge and critical part in a startup’s success and can make or break a business, making investment decisions solely by personality and ignoring the actual business aspects doesn't seem like a sane strategy in a capital intensive field like DeepTech.
If we were talking about regular startups then I’d agree, at early stage the business idea doesn’t really matter much (it’s likely to pivot anyways). But monuments are different than lift & shift.
Deep Tech vs. things that have a previous playbook are different in a few ways, but at the beginning - they all are two people and a dog.
The difference between early stage and later stage to me are very different: The optimization of luck vs the optimization of access.
Making investment decisions with the belief their personality build a big company does seem to be a good filter to me. However, there are many ways to make money in venture capital. All my stuff is geared toward super early stage.
As mentioned, I certainly agree regarding the importance of founder personality, especially at early stage. And naturally, the earlier the stage the more important founder personality is vs other elements. Th contentious element is whether personality alone is enough to make an investment decision, as suggested in the article.
Let’s say you meet a really great founder (ticks all the boxes you’re looking for in a founder) who’s looking for an investment for a great startup idea (the next big thing of something), so you invest.
Now let’s assume you meet the same great founder but now he’s looking for investment into an idea which is terrible. Would you still invest? His personality makes him a ‘no brainer’ from the article but the business idea is so bad you’re almost guaranteed to lose your investment.
Finally, you meet the same great founder but this time he’s has no real idea but he has registered a business and now he’s looking for an investor so he can spend time on finding a great idea for his business. Would you still invest? Again, he’s still one of those ‘no brainers’ from the article but at the time of investing you have no idea what he picks for an idea (or any, for that matter, before burning through your investment).
My point is that, while personality is important, the actual idea/business concept has to be part of an investment decision, at least to some extend. Sometimes, things that look great from one side of the table don’t appear the same when looking at them from the other side, and to me the 'no brainer' part of the article is one of these things (and I’m saying this as someone who actually walked away from a potential deal because of a similar issue).