2020 is the year of ambiguity, uncertainty, and anxiety. Investors are being very cautious when making decisions, as no one knows where the world is heading to. However, it is the job of early-stage VC investors to figure out what the future would look like. Out of curiosity, I looked up the deals closed by the top early-stage VCs this year and hope to learn from them by finding out some clues and directions.

212 deals from 43 top-tier early-stage VCs (both international and local ones) are found from Crunchbase. You can find a list of VCs covered at the end of this article. …

Why SMEs

After many years of development, the consumer tech space has been saturated, and it’s rare to find consumer-facing startups that have the potential as what Facebook or TikTok had at their early stage. Most of the big opportunities such as mobility, B2C logistics, and B2C e-commerce have been captured already. The relatively low market-entry barrier and the high scalability nature of B2C businesses always attracts the best talents and the most funding at the very early stage.

On the other hand, enterprise B2B technologies have also been well developed in many markets because it is very attractive to entrepreneurs due to the nature of large business customers. …

Originating from China, the novel coronavirus has infected 415,114 people and resulted in 18,559 global deaths by late March 2020. The crisis is undoubtedly one of the largest pandemics the world has endured.

However, there are many positive changes it has brought to society. For example, despite the heavy costs associated with the outbreak, the crisis has encouraged the Chinese government to be more transparent and has demonstrated the value of freedom of speech to the rest of the public.

For Venture Capitalists, the crisis does not necessarily mean completely stopping investment activities or worrying about the survival of portfolio companies. …

Startups are extremely vulnerable in the current COVID-19 crisis. However, some of them may struggle a lot, while others might suffer less or even see many opportunities.

As expected, the crisis is impacting not only the startup businesses but also many individuals now. This layoff data tracker developed by Roger Lee has provided us with a new lens to observe which startup sectors have been most affected and which are less impacted. Even though the data might be incomplete, it still indicates a lot — to entrepreneurs and investors.

These layoffs can be caused by three levels of risks — (1) the systematic risks that apply to all companies: e.g. less spending, lower efficiency due to the work-from-home (WFH) policies; (2) the industry-specific risks that apply to companies from certain sectors: e.g. less physical activities for the travel and hospitality industry; and (3) the idiosyncratic risks associated with each company: e.g. poor management, bad go-to-market strategies, and previous overhiring. …

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Illustration: Shutterstock

Driven by curiosity, I wanted to know where the top VCs invested into in the AI space. Over the past year, frankly speaking, our team has not seen a lot of exciting AI-related deals, and most of the stuff that we’ve seen was making some incremental improvement. Therefore, I was very eager to see how the top VC firms were thinking about what AI could do in the future. The best way to get the answer is to see where they have invested in.

Methodology

I pulled out from PitchBook the list of companies that were founded after 2017 and raised early-stage funding (angel, pre-seed, seed, series-A) from the top VCs. The top VCs are defined by Preqin in 2017 according to capital raised in the last 10 years (2008–2017). See the full top VC list here.

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I was watching an episode of a Chinese-version Shark Tank show on my flight back to the States from China. I found many red flags in the startup ideas pitched in the episode, and I decided to write down a list of red flags that I noticed in my VC career.

There are two posts (here and here) that have already covered many red flags identified by the top VCs. Therefore, I am not going to cover many of those “entry-level” red flags such as “founder being slow in replying emails”, “founder not grounded in reality”, and “founders are dating”.

Instead, I will cover the red flags that might be easily ignored. …

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The universe (Image: © NASA Images)

Having experienced a tough investment season last year, I was reviewing the early-stage deals closed by the top VCs in 2019 and wanted to figure out where they were pouring money into. Hopefully, I could learn something from there and find my next unicorn.

Before reviewing the list, I expected to see many investments in deep-tech startups. However, surprisingly, most of the invested companies do not have any proprietary deep technology. Instead, they are building something on top of some commonly available technologies and making it as a product. …

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“Leadership” has undoubtedly become the keyword that has been mostly mentioned in my life over the past three years — from my MBA application, to all the business-related classes, and to my current job. No one has ever given a clear definition of “leadership”, making it difficult to be “taught” and “learned”.

I have been discussing this topic with one of my closest friends recently. When I looked back and tried to collect some examples from my experience at OurCrowd and Plug and Play, I suddenly realized that leadership was all about “empathy” — putting yourself into your team member’s shoes first and then trying to find an alignment between the individuals and the team. …

Yesterday, I was reading an article shared by Kai from Sequoia China on the latest trends of consumer behaviors as well as the B2C investment opportunities.

One thing that resonates with me a lot is that: retailers are getting closer and closer to the consumersto steal market share from large supermarkets by offering services that are more convenient and much faster and to grow the market size by attracting consumers to purchase more. Eventually, getting closer to consumers also means knowing consumers better with more data and selling more types of products and services to consumers.

Interestingly, we observed the same trend in many other countries — from developed markets such as the US to emerging markets such as Brazil — with many startups working on the community-level “nano warehouse/distribution center/dark store” concept. …

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Yesterday, one of my friends shared with me excitedly that she’s going to have a brunch with an excellent person who she had admired for a while.

I was inspired to think about how we define ‘excellent’ and what makes a person excellent.

Apparently, there are different criteria for ‘excellent’ in different countries and cultures. In China, the country where I came from, people generally see a person ‘excellent’ if he/she owns a lot of properties in the tier-1 cities, if he/she has a well-paid job, or if he/she has a strong ‘power’ in the government.

However, I never feel those are the people that I consider excellent and will respect — neither will many of my friends. Then, how would I define ‘excellent’? …

About

Fan Wen

Investor at Plug and Play Ventures - Enthusiast for mobility, fintech, insurtech, emerging markets, and all the deep tech stuff. See more: https://wen.fan

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