Our investment thesis
In this newsletter we will discuss our investment thesis. Press play to listen to this newsletter
What is it?: an investment thesis is an outline of your strategy. It should identify the sector(s) you're interested in, why you believe this sector will grow, and the risks involved. Based on your thesis, you'll evaluate startups and reach a level of conviction (low, medium, or high).
Why do I need one?: you need a screening mechanism to filter out your deal flow. There are hundreds of startups raising at any point and its impossible to do a deep dive into all of them. There are also several distractions, FOMO (fear of missing out) being the biggest one. While investing alongside "great" investors is a good signal, it should validate your investment thesis not guide it.
How do I make one?: we'll do a webinar down the line on how to form it, but for now I'll talk about one aspect of it. What is the catalyst/ tailwind behind your investment strategy?
In his book "Outliers", Malcolm Gladwell discusses how tailwinds are responsible for quite a bit of our success. Tailwinds are external events (such as COVID, invention of smartphones, fast internet, wars and regulatory changes). In your thesis, you should try and identify which tailwinds you're banking on.
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Here are two growing tailwinds we are investing in:
1. Home-based care - too much of healthcare is delivered in facilities. These facilities are expensive to run and require considerable workforce. Most people would like to be treated in the comfort of their own homes. Home-based acute and chronic care solutions will continue to saturate the market and certain subsegments (such as care of elderly) remain largely untapped.
2. AI/ML to replace administrative/ clinical tasks - I think we are 5 years out from regulatory changes which will allow software to diagnose and treat. This will be expedited by the worsening healthcare clinician shortage. As more clinicians leave, it adds to the workload of those remaining and worsens burnout. Any solution in this space which involves clinicians “doing more” will not survive.
Updates:
Neel Patel:
Neel is an experienced investor and has invested in numerous startups. He is the current CEO of Zio Health. He will be joining us as an advisor.
Vena Medical: creator of a micro-angioscope for thrombectomy.
We invested in Vena Medical earlier this year. Congratulations to the team for 13 successful cases in Canada. They are currently looking for a Project Manager (based in Kitchener, Ontario) and help around FDA strategy. Feel free to reach out if you're interested.
