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Understanding the Market

Ayushi Sinha
Prospect Student Ventures
Published in
10 min readAug 1, 2020

Before you start investing, it’s important to understand both the broader tech market and more verticals that you are specifically interested in. First, we share general resources that are a great place to start to learn about the intersection of tech, entrepreneurship, and finance. Second, we will breakdown specific industries and share resources specific to each.

Our Favorite Sources for Tech News + High-Growth Companies

  • Axios (Axios Pro Rata is a Daily newsletter that dives into the world of dealmakers across VC, PE, and M&A. By Dan Primack, a top deal reporter. Axios Login is a daily newsletter with tech news/deals)
  • Tech Crunch
  • Crunchbase
  • Hacker News
  • Morning Brew and Emerging Tech
  • The Information
  • The Daily Pitch from Pitchbook
  • Forerunner’s Newsletter (for consumer space updates)
  • M&A/IPO updates
  • StrictlyVC
  • Fortune Term Sheet
  • GoingVC Newsletter
  • Accelerated Newsletter and Slack Group
  • Avc.com by Fred Wilson
  • Stratechery
  • Bloomberg

How to Start Learning About a Specific Industry

Consumer

Investors

Sarah Tavel — GP @ Benchmark, focusing on consumer, marketplaces, etc

Aileen Lee — seed, consumer @ Cowboy VC

Rebecca Kaden — seed, consumer @ Union Square Ventures

Nikhil Basu Trivedi — ex-consumer @ Shasta

Megan Quinn — growth, consumer @ Spark Capital

Amit Mukherjee — consumer @ NEA

Venture Twins (Justine and Olivia Moore) — consumer @ CRV

Tripp Jones — consumer internet + marketplaces @ August

Theory

Nir Eyal

Eugene Wei

Kevin Kwok

Ed-Tech

Venture Firms:

  • GSV
  • LearnLaunch (Accelerator)
  • Rethink Education
  • Lightspeed Venture Partners
  • Owl Ventures
  • Techstars
  • Reach Ventures
  • Learn Capital
  • NewSchools Venture Fund (Non-profit)
  • Social Capital
  • New Markets Venture Partners
  • Lumos Capital Group

Key Problems:

Student Loans

Higher Education

  • How does COVID affect higher ed?
  • Endowments are not uniformly distributed. Which colleges will survive given the loss of tuition and room + board?
  • Where will the demand go? Will alternative education be online?
  • What will the transition online look like?
  • Can you replace the college brand? If so, how? Might online education replace diminishing regional brand awareness?

Will we see less focus on institutional education?

Democratizing access to education

How do you tailor education to individuals using factors like AI?

Consumerization of education

Question of “infotainment” — does a Netflix doc compete with CodeAcademy?

Other Resources:

Security/Privacy

Industrials

Firms focusing on Industrials:

  • OCR Capital
  • Summit Partners
  • Emerald Technology Ventures
  • Artemis Capital Partners (usually later stage)
  • Anzu Partners

Key Problems:

  • An industry with massive economies of scale: how to get a grip on more of the market?
  • Divisible into freight, management, etc.
  • When crossing country borders, massive regulation issues to deal with
  • What are the effects of COVID-19?

Agri-Tech

Overview

  • Commercial agriculture uses way too much water and land, bad for business and especially bad for the environment
  • New technologies are allowing for growing at scale in extremely regulated indoor environments where everything is automated to grow the best-tasting plants with the least resources.
  • New indoor farming techniques enabled by tech allow for growing warehouses to be close to city centers, saving on transportation, and shortening the supply chain (fewer preservatives!)

Key Problems

The main issues right now are perfecting the growing process and cutting down costs, and the main issue is electricity costs (rise in renewables should help). Not all types of plants can be grown in indoor farms either, only limited to leafy veggies like arugula. More intensive plants, like potatoes or corn (America’s most popular crop due to being used in animal feed), can’t be grown in this way. Rise of lab-grown meats will alleviate the need for that much feed, but in any case, new methods are necessary for other crop types that are more environmentally taxing.

Companies

  • So many opportunities in automated indoor hydroponic farming! Here are some examples:
  • plenty.ag — Backed by Bezos Ventures, absolutely jaw-dropping growing process
  • Bowery Farms — vertical farming
  • Iron Ox — different approach, more reliance on robots
  • Lab-grown or plant-based meats
  • Just Foods, Memphis Meats, etc. Keep these in mind as they will change the supply chain in agriculture!

Energy

VCs/Accelerators

  • Golden Palm — Based in Ghana and founded by Sangu Delle
  • Breakthrough Energy — Bill Gates-backed VC investing in cleantech/energy solutions
  • Clean Energy Venture Group — 500M Boston and New York-based VC which provides seed capital and management expertise to early-stage clean energy companies
  • G2VP — 300M fund investing in sustainable energy for business services
  • Khosla Ventures — 5B CA-based VC focused on financial services, big data, and robotics industries, with a particular focus on the internet and clean technology sectors

Individual investors

Companies

Small scale renewables

  • Rensource — Nigeria based company bringing clean and reliable electricity to SMEs in W Africa by harnessing solar power (also see report here).
  • M Kopa — Kenya based startup which uses finance plans to sell home solar installation/equipment to low-income families.
  • Zola — This Tanzania based company sells integrated powers systems to provide sustainable power supply while leveraging renewable energy (e.g., solar).

Software players

  • Sighten — an SF based software company that provides a solar implementation toolset to support distributed generation (DG) solar workflow of home solar installments.

Electric Vehicles

  • Byton — Chinese based luxury EV company focused on smart technologies (see also).
  • Rivian — CA-based electric vehicle company selling sleek sporting vehicles.
  • Proterra — CA-based B2B providing high-quality electric powertrain technology for heavy-duty vehicles (e.g., city buses, construction vehicles).
  • eMotorWerks — This CA-based startup sells high efficiency and high power EV charging stations for home and commercial use.

Other resources

SaaS

People to follow

Other resources

FinTech

Fintech incorporates all the technology being used to provide financial services in new and innovative ways. To develop a good understanding of the market, it is important to know both what the big more established traditional companies and the new more innovative companies are up to.

Understanding Established players guide to financial tech resources:

***Note big established players in the space partner with startups so, on top of understanding what big players do, it is important to know who they are partnering with as well.

BCG.com / Mckinsey (search insights on fintech) (examples of insights)

  • Digital Lending
  • Consulting companies are a great beginners guide to understanding Financial services more broadly

Goldman Sachs (Understand who they are investing in the fintech space)

Visa (Who they are partnering within the fintech scene)

Think about larger players in the financial industry game. More often than not big organizations are partnering with fintech startups. Looking at who these organizations are partnering with is a great place to begin understanding the interaction of the established players and startups.

Understanding Start-up Fintech Scene:

Understanding Finance in general:

Fintech is Finance AND tech. Understanding finance as an industry is thus important. This means brushing up on regulations governing the industry reading finance-focused publications and just understanding how the world of finance currently works to get a good sense of where the opportunities lie:

  • Sites to think about (Economist, Bloomberg)
  • The extra perk of being a Princeton student we all get free economist subscriptions if you use eduroam (Princeton wifi) so USE IT!!!

Digital Health

Good resources

2020 Midyear Digital Health Market Update

Modern Healthcare

STAT

Healthcare IT News

From my friend Sarah Slater: “It’s important to spend some time just understanding how the healthcare system actually works (or doesn’t) … you’ll, of course, need to understand the product, but you’ll also need to really understand who the customer is, what they need from it, what challenges and incentives they face, etc. For more general reading on how health care works in the US in addition to the resources above, I’d suggest books like America’s Bitter Pill or The Social Transformation of American Medicine (the former will probably suffice). For a good breakdown on who the players are in US health care, I’d also suggest looking at Khan Academy Videos on the topic.”

Bio-tech

A great place to start: How to Learn Biotech. The most widely-read list of resources

Biotech Industry, Biotech News, Biotechnology Articles — FierceBiotech

Top investors: 12 VCs who matter in biotech, but you hardly ever read about

Emerging Tech

Investors

  • Future.ventures
  • Lux Capital
  • Newlab
  • Bold capital ventures (Peter Diamandis VC)

Newsletters

  • MIT Download
  • Emerging Tech by Morning Brew

Augmented Reality/Virtual Reality/Mixed Reality (XR)

Good resources:

XR | Inside.com

Road to VR — Virtual Reality News

ARPost — Augmented Reality News | Virtual Reality News

Extended Reality

Space

Good resources:

SpaceNews

Space News — Latest Space and Astronomy News

Space Ventures Investors

VCs to follow:

Space Angels (NYC-based VC)

How to Start Learning about a Geography

Emerging Market Case Study: African Market

Here’s our framework for understanding emerging economies. While we focus on the African market for this case study, our framework can be applied to other geographies.

Understand the overall political and social context

  • Regions (East, West, Southern, North, and Central)
  • Language influences within regions (anglophone, vs Francophone)
  • Political trends

Understand economic narratives of regions and countries

  • Rapid growth rate countries (Ethiopia, Rwanda, Senegal, Ghana)
  • Slow and stunted growth rate countries ( Zimbabwe)
  • Economic powerhouses (Nigeria, South Africa, Kenya)

Think about overlooked countries with vast potential

  • There are 54 countries, look at the map and think of which countries you frequently see in your reading. Which ones stand out as frequently referenced, which are not ?)

Look at cool new business models rocking the continent

  • Fintech (M-Pesa, Econet)
  • Agriculture
  • Education

Reach out!

Talk to people from the continent understanding that Africa is huge and people will speak to their individual experience which may/may not be reflective of what many on the continent experience

Podcasts

More Resources:

Top 10 Venture Capital Podcasts You Must Follow in 2020

19 VC and Startup Podcasts

The 20 best venture capital podcasts investors recommend listening to

Twitter

Our favorite investors on twitter (courtesy of Albert Wang)

Ram Parameswaran (@_ram_), Tomasz Tunguz (@ttunguz), Alex Clayton (@afc), Jamin Ball (@jaminball), Beth Kindig (@Beth_Kindig), @adventuresinfi, Ophir Gottlieb (@OphirGottlieb), Richard Chu (@richard_chu97), Bread Crumbs Capital (@CrowdedTradeCap), @StackInvesting, Chetan Puttagunta (@chetanp), Steve Burns (@SJosephBurns), Gavin Baker (@GavinSBaker), @FromValue Techcrunch

Looking for growth investors on Twitter? Check out the Growth Investing Resource List

Other resources

From DRF’s Student Resource Guide: Uncovering Venture Capital

  • “USV, 8VC, a16z are funds that publicly publish high-quality theses.
  • VentureStories by VillageGlobal is a podcast in which founders and VCs are interviewed specifically about their theses. (Note: VCs publish often, but It’s rarer to hear founder theses and how they translate to clear product and business model choices on this podcast.)
  • 20MinVC podcast will often highlight individual theses by different venture capitalists, sometimes focusing on founding teams, and sometimes on specific markets. a16Z podcasts also outline theses occasionally.
  • John Gannon has great resources and examples of investment theses developed by aspiring VCs as part of the recruiting process.”

Market Map

Template for Putting Together Your Own Market Map

From How to Create Your Investment Thesis

1. Overarching trends that are shaping the industry and/or consumers’ psychology

2. Macro/Micro beliefs/assumptions that the thesis is founded on

3. Thesis definition

4. Supporting evidence and insights from charts/data that supports trends

5. Startups of interest (4–5 startups that fall into the thesis)

6. Non-industry focused startups (2–3 startups that are super interesting)

7. Future investment opportunity (1 startup that is early but has aspects of the thesis)

More resources for Market Maps

Market sizing

Here are some resources to learn how to slice the market

This section was authored and inspired by Ayushi Sinha, Kat Xiao, David Babikian, Daniel Wood, Sarah Slater, Jailany Thiaw, Rohan Shah, Sarah Du, Tinashe Handina, Kelvin Yu, Liz Petrov, Eno Reyes, Vignesh Rajendran, and Albert Wang.

Market
Marketplaces
Research
Entrepreneurship
Venture Capital

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Ayushi Sinha
Prospect Student Ventures

Written by Ayushi Sinha

131 Followers
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MBA @ Harvard, co-founder @ yustha.yoga | Princeton CS, investor @ Bain Capital Ventures, Microsoft

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