What Is Thesis Driven Venture Capital?

investment theses venture capital

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.

Union Square Ventures is one well known thesis driven fund. In fact, USV publishes their theses publicly, often  updating them with each new fund.

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

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