Orit Gadiesh, the chairman of Bain & Company, once described an important trait of successful people: The ability to be an “expert generalists.”
Expert generalists are interested in all kinds of stuff, rather than focusing on one specific thing. It’s a huge learning advantage. Gadiesh explained: “He or she can, without necessarily even realizing it, draw on that palette of diverse knowledge to recognize patterns and connect the dots across multiple areas.”
The Collaborative Fund began with a similar idea. Our investment philosophy drove our decisions, but our interests were broad, and we were mostly agnostic about the industries we invested in. We were curious, and sought opportunity wherever it presented itself, which spanned all kinds of businesses. Reddit, the online discussion platform? Yep. MindSnacks, an app that teaches language through games? Yep. Creative Mornings, a breakfast lecture series? Yep.
We got to know these various businesses, and invested. We were generalists.
But as Collaborative Fund has matured, I’ve come to appreciate the value of taking a more targeted approach to how we invest.
We’ve been inspired by thematically focused funds like Closed Loop Fund and GovTech Fund, which have carved out niches for themselves in certain categories.
Category focus allows us, as investors, to add value for entrepreneurs with deeper industry connections than a generalist fund can provide. And, because of that help, it puts us closer to the top of everyone’s mind in specific categories, which is critical for deal flow.
We now focus our attention on five categories that represent where we see the most meaningful changes in the world.
Cities. More people are living in cities than rural areas for the first time in history. We back companies that use technology and networks to make it easier and more efficient to live in cities, where population growth continues to migrate. We are investors in: Lyft, TaskRabbit, MakeSpace, Thumbtack, Roam, SOCAR, among others.
Kids. Child development is often overlooked by venture capitals. But there’s so much going on in this space, with companies using technology to reinvent how to educate and advance future generations. We’ve partnered with Sesame Workshop in this area, and are investors in: Hopscotch, Revolution Foods, Kano, DIY, among others.
Consumer. People increasingly demand products that are not just functional, but ethical and relatable. We support new consumer brands that are healthy, sustainable, and focus on design and user experience. We are investors in: Sweetgreen, Blue Bottle Coffee, Hampton Creek, Good Eggs, Impossible Foods, Outdoor Voices, Walker & Company, Ripple Foods, among others.
Health. It’s unacceptable how little most people know about their health in the Information Age. We back companies that empower consumers with data to help them take control over their health, and are upending medicine’s traditional R&D model. We are investors in: Science Exchange, Sherpaa, Zipdrug, Opencare, among others.
Money. Financial services is a huge industry dominated by incumbents with room for disruption. We support companies that are democratizing financial services in ways that are equitable and transparent. We are investors in: Kickstarter, Earnest, Bond Street, Tala, CircleUp, Upstart, among others.
Our interests and education will always be broad. From a learning standpoint, we still think of ourselves as expert generalists. But we’re confident that by focusing on a few key categories we can leverage our knowledge and investing skill better than we could with a broader, generalist approach.
More about our investing philosophy here.