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Fresco capital Venture Investing Do's & Don'ts

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What's the best way to learn about venture capital? How can we transform venture capital? This starts with the basics and then keeps progressing to ideas about how we can transform venture capital.

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Fresco capital Venture Investing Do's & Don'ts

  1. 1. The Do’s & Don’ts of Venture Investing Tytus Michalski
  2. 2. Global venture capital & innovation agency 3 Managing Partners, 8 Team Members, 26 Impact Partners 50 portfolio companies, US$1.5B market value, 600+ co-investors FRESCO TEAM FRESCO IMPACT PARTNER FRESCO PORTFOLIO
  3. 3. What’s the best way to learn the do’s and don’ts of venture investing?
  4. 4. Memorizing all the correct answers like our traditional education system?
  5. 5. Unlikely. Not being right more often. Mostly wrong and RIGHT BIG.
  6. 6. Are credentials (MBA, CFA) the key to learning all about venture investing?
  7. 7. Not really. Credentials create signals. Only tangentially related.
  8. 8. Is artificial intelligence the ultimate solution to venture investing?
  9. 9. Not yet. Small data set of success. Open ended problem(s).
  10. 10. Venture investing is a mystery. Fortunately, some clues can guide us. The Mystery
  11. 11. Clue #1 Venture investing requires practical experience, not just theory.
  12. 12. Clue #1 Learning by doing.
  13. 13. Clue #2 Venture investing requires creativity to find true innovation.
  14. 14. Clue #2 The arts.
  15. 15. Clue #3 Venture investing requires discipline to create enduring success over time.
  16. 16. Clue #3 Martial arts.
  17. 17. To learn the do’s and don’ts of venture investing use martial arts.
  18. 18. White Belt Build the basics.
  19. 19. “The hardest part is showing up.” – Sensei Alan Lai
  20. 20. Don’t: think you can get quality without time and effort. White Belt Venture
  21. 21. Do: say “No” to 99+ opportunities for every 1 investment made. White Belt Venture
  22. 22. “Karate is a lifetime marathon.” – Master Shoshin Nagamine
  23. 23. Don’t: expect a 3 month trade and low cost liquidity. White Belt Venture
  24. 24. Do: align time horizon with assets, 3, 5, 10+ years. White Belt Venture
  25. 25. Traditional martial arts has no tournaments and no trophies.
  26. 26. Don’t: chase famous startups and award shows. White Belt Venture
  27. 27. Do: have a diverse network to find “underground” opportunities. White Belt Venture
  28. 28. Green Belt Train your technique.
  29. 29. Use superior technique and speed (acceleration) instead of brute force.
  30. 30. Don’t: waste resources on brute force due diligence. Green Belt Venture
  31. 31. Do: learn disciplined, fast and repeatable due diligence skills. Green Belt Venture
  32. 32. “Kata is zen. Kata is simple yet difficult.” – Hanshi Robert Scaglione
  33. 33. Don’t: Re-invent term sheets from scratch. Green Belt Venture
  34. 34. Do: be clear about trade-offs and your priorities for terms. Green Belt Venture
  35. 35. The mirror is the most useful tool in the dojo.
  36. 36. Don’t: become complacent because startups chase you. Green Belt Venture
  37. 37. Do: stay open to explicit and implicit feedback. Green Belt Venture
  38. 38. Brown Belt Power your impact.
  39. 39. Strength starts from the bottom and flows upwards.
  40. 40. Don’t: become too top heavy in management teams. Brown Belt Venture
  41. 41. Do: proactively support talent management efforts. Brown Belt Venture
  42. 42. Partner training requires open communication and trust.
  43. 43. Don’t: be passive or micromanage teams. Brown Belt Venture
  44. 44. Do: build trust by being open and give tough love feedback. Brown Belt Venture
  45. 45. Apply maximum power with minimum surface area at the point of impact.
  46. 46. Don’t: create a smaller version of a large company. Brown Belt Venture
  47. 47. Do: identify and focus on the core metrics. Brown Belt Venture
  48. 48. Black Belt Enhance awareness.
  49. 49. “Step first, then punch.” – Master Ansei Ueshiro
  50. 50. Don’t: sell the winners too early (or too late). Black Belt Venture
  51. 51. Do: build a process to evaluate risk vs. return over time. Black Belt Venture
  52. 52. Empty your mind.
  53. 53. Don’t: let your experience crowd out your mind. Black Belt Venture
  54. 54. Do: stay open to unexpected opportunities. Black Belt Venture
  55. 55. Win without fighting.
  56. 56. Don’t: get caught up in war and sports metaphors. Black Belt Venture
  57. 57. Do: find trusted partners who share your values. Black Belt Venture
  58. 58. Sensei Embrace the paradox.
  59. 59. Find your personal style. Keep the tradition and be original.
  60. 60. Don’t: simply copy and paste from other venture investors. Sensei Venture
  61. 61. Do: co-create new approaches with trusted partners. Sensei Venture
  62. 62. Traditional martial arts combines physical with mental and spiritual training.
  63. 63. Don’t: overlook the indirect financial and non-financial benefits. Sensei Venture
  64. 64. Do: challenge assumptions about traditional venture investing. Sensei Venture
  65. 65. Teach the philosophy and values to others by training.
  66. 66. Don’t: hide the secrets of venture investing from others. Sensei Venture
  67. 67. Do: identify the right partners and train them to succeed. Sensei Venture
  68. 68. Who Can Learn Martial Arts? Anyone from age 5 to 95+ has the potential to train martial arts.
  69. 69. Anyone from age 5 to 95+ has the potential to train venture investing. Who Can Learn Venture?
  70. 70. A black belt is just a white belt who never gave up.
  71. 71. tytus@fresco.vc @tytusm

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