Reading the Tea Leaves of Venture Capital Today

10 themes tech VCs are paying attention to

The Ever-Changing Nature of Investor Sentiment

Venture capital evolves over time and the attention of the investment community does as well. Just think about the shift in interest of technology investors from social networks to social gaming to photo sharing apps to mobile gaming to enterprise businesses to Bitcoin. It moves in waves. If you’re early enough, you can feel it just below the surface and then it rumbles to the top in the form of lots of funding activity.

As I’ve written before, investor interest in a space lags behind entrepreneur activity in a space. As a general rule, entrepreneurs see the future and investors over time come to see it. As an investor and entrepreneur, the hardest part is getting the timing right. If you’re too close to the edge, sometimes you lose sight of where you are in the evolution of an innovation — then you end up where many serial entrepreneurs have been at one point in their career — “too early.”

It’s helpful to read the tea leaves and get a pulse on what the investment community is paying attention to. As an investor, this can help one think about areas that may be underserved, misunderstood, and or under appreciated by the broader investor community (for example, Bitcoin before late 2012/early 2013). As an entrepreneur, this can help one think about fundraising strategy and get a gauge on interest in your space (it can also have the negative effect of distraction and encouraging the chasing of the-next-hot-thing).

Where Are We Today?

This is my informal, not-data-based reading of what the broader tech venture capital community is paying close attention to:

1. Drones
2. Bitcoin
3. Wearables
4. Big Data
5. Crowdfunding
6. Quantified Self
7. 3D Printing
8. The Internet of Things
9. Mobile
10. Virtual Reality

And though much remains to be determined in these areas, this is great keep everything in perspective:

the next big thing always starts out being dismissed as a “toy.” This is one of the main insights of Clay Christensen’s “disruptive technology” theory.

-Chris Dixon

I’m excited to see how these and other areas of technology evolve over the coming decades.

Boris Silver is Co-Founder and President of FundersClub.

twitter: @borismsilver

essays: www.medium.com/@borismsilver

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