In the summer of 2012, Boris Wertz proudly announced the launch of Version One Ventures. Fast-forward a decade: he this month celebrated 10 years of venture capital under his brand.
Today Version One is a multi-fund franchise funds with investments in several dozen companies and a quarter billion dollars in assets under management. Some of Version One’s more recent investments include Victoria’s Defined, Vancouver clean tech startup Moment Energy, and web3-pioneer Dapper Labs.
Wertz, a crypto-philanthropist, said in an online statement that he feels “endless gratitude for reaching this milestone” and thanked everyone who has “contributed to the journey.”
He also shared some nuggets of wisdom from his experience.
Look for Non-Obvious Opportunities
Early stage investing creates the best outcomes “if you’re investing in non-obvious opportunities in markets that are early on their S-curve,” says Wertz. If a category is “branded,” so to speak, a venture capitalist is “probably too late” to realize worthy returns.
“For example, once everyone talks about the sharing economy, you’ve probably missed Airbnb,” he explains.
When V1 began in 2012, the fund targeted SaaS and marketplace startups.
“Since then, we have jumped into many categories that were early on the S-curve at the time,” says Wertz, citing focuses on healthcare bio-tech in 2014, crypto and Web3 in 2016, robotics in 2019, climat and energy in 2020 and even this year: VR/AR.
Founders are Foundational to Success
The earlier you invest, the more your success comes down to the founders.
“Some of the biggest success stories have been pivots where the entrepreneurs created a completely new opportunity out of nothing,” Wertz notes. On the flipside, however, “we never had much success when we had more conviction about the business than the founders.”
In fact, Wertz is so committed to this philosophy that V1’s investment thesis has been distilled to “backing mission-driven founders at the earliest stages.”
“99% of the magic is created by founders and their teams,” he affirms.
How to Create Impact
As a VC, “your impact on the success of a business is limited,” admits Wertz.
To maximize impact, you must be willing to commit capital when nobody else does. Which, as Wertz notes, only makes sense if you “do it all with conviction”—hence investing in founders, not startups.
“An investor’s biggest impact comes when he or she believes in a team when no one else does, he says. “Be the first cheque, lead a round, help with a bridge.”
Conviction may require more than just capital, however.
“Founders need a true and long-term partner,” says Wertz. “Not just a cheerleader.”
Art Versus Science
If you take Wertz’s advice and still fail, don’t take it personally. In the end, despite the precision of finance and power of technology, Wertz believes that early-stage investing is “more art than science.”
Not everyone can be a great artist.
After a decade of full-time investing, the veteran VC has gained much clarity in the field. And all of that clarity has him confessing that early-stage investing remains, in no uncertain terms: “very, very hard.”
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