Amazon, retail and consumers. Real tech wins.

Amazon is a behemoth. A brilliant one too. Between the proposed acquisition of Whole Foods and now the launch of Wardrobe Prime, I’m legitimately excited. This is the world we, as consumers deserve. Highly efficient, logistics companies capable of increasing volume and lowering costs. This is significant innovation, built on nearly 20 years of expertise. It’s not fast and irresponsible. And venture capitalists should take note.

Betting on incremental business model changes has a shelf life. While these types of companies may exhibit “great traction and high-growth rates”, they run the risk of playing the never ending user acquisition game. A game only suited for endless pockets. This is why we don’t invest in delivery companies or incremental business innovations. Over the next 3 years (and perhaps the past 18 months), we will watch VC-backed startups struggle. Struggle for new customers, to own a larger share of the wallet, and ultimately fail to reach a liquidity event that supports the exorbitant amount of capital they’ve raised.

This is why we bet on technology first-startups. Technology based on key insights and new mandates. Hard to replicate business strategies. Take for example Lily, the first commerce platform for women’s fashion based entirely on emotional intelligence. The team has spent the past 2.5 years building it — painstaking at most times. There are no subscription boxes, no delivery fees, no inventory. Just technology that gives the company new data, with or without a purchase. Users and retailers love it. It drives behavior never seen in the offline world. This is their moat. New and unique data only they have — perceptions and emotional state. The primary reason 1 in 3 users keep on buying — 10X industry average. It’s because Lily just gets them.

It’s not easy and over the next number of years we anticipate more excitement around applied AI and intelligence. Finding a balance for growth and tech is critical, and we will invest at the ground floor. For companies that own the data pipes, we applaud you. Especially in the consumer world, where your data can’t be created or found anywhere else.

Congrats to all the consumers of the world. We are winning.

w/b Manan Mehta