What differentiates one venture fund from another? Often it may not seem like much.
One of the key differences is whether a fund is “thesis driven”.
A thesis driven venture fund means the fund has a particular world view, or perspective. They actively spend time seeking investments that match specific problems, platforms or trends the partnership is particularly bullish on.
Note: Benchmark’s Bill Gurley has become known as archetype of thesis driven investing. Bill famously held the thesis that a founder would disrupt yellow cabs and transportation. He searched for and passed on many transportation startups before finding Travis and Uber.
Recently another thesis driven fund, Betaworks, invested in a founder and company I have covered on this blog before: . Howard’s new company Stocktwits is super interesting and fits many of my own ideas of where the world is moving with information sifting and real-time data.
Andy Weissman, a partner at Betaworks describes the StockTwits investment in context of Betaworks’ thesis around structuring unstructured data and data exhaust:
The investment in Stocktwits fits squarely in one of the two main areas that comprise our network – those applications or services that take unstructured data and structure it, in a way that provides value to a user, advertiser or publisher (or all three).
Our wholly unoriginal thought is that the world of media is combining, or becoming closer, with user content, to form a new kind of media. One of the implications of user content is that it creates “data exhaust”.
Stocktwits takes financial related data – using Twitter today as the content production platform ー and structures it ー by stock, user, reputation, etc., thereby adding value at multiple steps of the way, to multiple participants. Using this new platform, a new form of content is created, which can be used in new ways.
We believe there is a lot of value in that model.
- I keep a running list of various venture fund theses; they are fascinating reading material.
- Andy Weissman is now a partner at Union Square Ventures