You're expanding your VC portfolio to new industries. How do you navigate the risks and opportunities ahead?

Shifting or adding a new vertical to your investment thesis/portfolio is always challenging initially. Detailed industry analysis is crucial when exploring new verticals and conducting a comprehensive market assessment, which involves understanding the industry's size, growth trajectory, technological landscape - including how innovation is shaping the sector -, emerging trends, and the competitive landscape. Of course, it is important to do the desk research but at the heart of it, you need to talk with the industry players, understand their dynamics, and listen to their problems and ways of doing. A Mix of desk research and field research will help you take more calculated risks.

Il faut déjà analyser les éléments clés du marché ainsi que ses forces et faiblesses. Ensuite regarder les perspectives d’évolution de ce marché, la taille de la concurrence ainsi que la possibilité de prendre et développer ses parts de marché à court, moyen et long.

Ao expandir um portfólio de capital de risco para novos setores, é crucial adotar uma abordagem estratégica para equilibrar riscos e oportunidades. A análise profunda do setor, incluindo tendências de mercado, concorrência e regulamenta??es, é essencial. Diversificar os investimentos dentro desses setores ajuda a mitigar riscos, enquanto o monitoramento contínuo do desempenho permite ajustes necessários. Essa combina??o de pesquisa, diversifica??o e adapta??o é fundamental para maximizar os retornos, minimizando os riscos envolvidos.

Expanding to new sectors is a great way of mitigating risks in the VC industry. Some of the best ways to do it are: - Read, read and read. Read all possible news articles, reports about the sectors that you intend to invest in and how the companies in that sector are performing. - Connect with industry experts, mentors and your Peers in VC to understand market trends , challenge and potential that they see in these sectors. - Find out the hottest startups in those sectors and start building a rapport with the founders and gain their trust. Keep in mind that while you need to be cautious , don't indulge in procrastination otherwise you might miss significant investment opportunities.

Before committing to new sectors, you have to conduct in-depth industry analysis. Understand the market size, growth trends, competitive dynamics, and regulatory environment. Networking with those who have done it before will also add extra insight. This helps in identifying promising opportunities and potential red flags.

Il faut : -éviter de se concentrer sur le multiple principal indicateur du fonds; -éviter de parler de performances brutes aller plut?t sur du net; -Comprendre comment les sociétés en C-R calculent la juste valeur marchande de leurs portefeuilles; -Comprendre le sens des indicateurs TVPI et DPI (leur fonctionnement); -Faire attention aux DPI trop élevés un peu trop t?t dans la vie du fonds; -Vérifier si le Capital-risque est optimiste ou prudent grace à son track record.

Evaluate sector-specific risks like technological changes, market saturation, and regulatory shifts. Assess the business models, leadership teams, and product-market fit of potential investments

Basado en mi experiencia corporativa y académica, me gustaría, no solo hacer énfasis en la importancia de realizar una apropiada evaluación de riesgos, sino también recomendar un par de herramientas que han sido muy útiles en mi trayectoria para hacer una gestión adecuada de estos, a saber: Risk Simulator y Crystal Ball, estas dos herramientas permiten realizar el montaje de modelos financieros tan sencillos o robustos como sea necesario, brindando los instrumentos estadísticos requeridos para poder realizar no solo una medición sino una priorización de las variables más riesgosas en cada caso particular, permitiendo correr miles de simulaciones que generan resultados valiosos para la toma de decisiones. Recomendado en análisis tornado.

Identifying opportunities in emerging industries requires a sharp focus on innovation and disruption. Seek out companies that are not merely participants but are driving the industry’s evolution. These often include startups with distinct value propositions, robust intellectual property, or groundbreaking business models. Early identification of such prospects can position your portfolio for substantial growth. Remember, not all hunters strike gold, but those who move swiftly—the early birds—often seize the most lucrative opportunities before others catch on.

Who are the game-changers? What specific sub-sectors are ripe for disruption? Companies with unique value propositions, strong intellectual property, or disruptive business models are often where the best opportunities lie.

While diversification is often touted as a key strategy, I don't fully agree that it’s always the best approach. A well-thought-out diversification strategy can be valuable when expanding into new industries, but it's crucial to maintain focus. The goal should be to find the right balance, selecting sectors that truly complement your existing portfolio and align with your expertise and investment thesis. Diversification shouldn't dilute your focus; instead, it should enhance your ability to achieve your investment goals by targeting sectors that offer the best synergies and growth potential.

La diversificación es generalmente presentada como una de las mejores estrategias para minimizar el riesgo, sin embargo, esta también es un arma de doble filo y es lo que generalmente no se menciona con el debido rigor. Como CEO de un grupo empresarial presente en 4 industrias diferentes, puedo dar fe de que la diversificación debe basarse en una selección adecuada de productos, servicios, proyectos, empresas, sectores o industrias que de manera conjunta generen una gran sinergia al interior del portafolio que conforman y por ende todas deben contribuir, financiera o estratégicamente, con la generación de valor al interior de la organización.

The key to understanding new and unfamiliar territory is knowledge and experts. It's best to do a lot of reading on various topics to get a baseline knowledge and then call in the cavalry (AKA PhDs, industry experts, professors, etc.) who know those areas really well. As much as you know, you'll never know more than the experts. Better to have people intimately understand industries and subject matter than rely on your own info alone.

Totally agree—adopting an all-in approach can be a powerful strategy when entering new industries, but it's equally crucial to have a clear exit plan. Understanding typical exit scenarios—whether through an IPO, acquisition, or merger—allows you to invest with a well-defined endgame, optimizing your timing to maximize returns. Market conditions can shift, so maintaining flexibility is key. And remember, sometimes knowing when to stop is just as important; if your business model isn't gaining traction, pivoting or exiting may be the best course of action.