Launching a multi-strategy firm with all core strategies at once is harder upfront but crucial for long-term success. A sequential build creates path dependency, where risk systems, technology, and culture become optimized for the initial strategy, making it difficult to integrate new, different strategies later.
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Undiversified founders can't afford a VC's portfolio mindset. Instead of pursuing ideas that *could* work, they must adopt strategies that would be *weird if they didn't work*. This shifts focus from optimizing for a chance of success to minimizing the chance of absolute failure.
Building a multi-strategy fund sequentially by adding 'satellite' strategies to a 'core' one is flawed. It signals to investors and potential hires that the new areas are non-essential, making it harder to attract top talent and leading to pressure to cut them during downturns.
The 'compound startup' model of building multiple products at once is only viable when integration is more valuable than best-of-breed features. It also requires a shared platform architecture that genuinely accelerates the development of each subsequent product.
The key to effective portfolio entrepreneurship isn't random diversification. It's about serving the same customer segment across multiple products. This creates a cohesive ecosystem where each new offering benefits from compounding knowledge and trust, making many things feel like one thing.
The dominant VC narrative demands founders focus on a single venture. However, successful entrepreneurs demonstrate that running multiple projects—a portfolio approach mirrored by VCs themselves—is a viable path, contrary to the "focus on one thing" dogma.
Instead of starting with easy MVP features, PointOne built its complex AI time capture before manual entry. This strategy validates the core technical moat and riskiest assumption upfront, preventing wasted effort on a product that is ultimately not viable.
When facing multiple promising growth opportunities, founders should avoid pursuing them all at once. Instead, sequence them by designating one channel as the primary "engine" for the next 6-18 months, treating others as mere proof points to maintain focus.
When expanding a fund's investment thesis, avoid making multiple changes simultaneously, such as moving from venture to growth stage AND from software to hardware. Making more than one 'leap' at a time dramatically increases risk and magnifies blind spots. Instead, change one variable at a time, like moving to a later stage within a familiar sector, to manage risk effectively.
Balance your roadmap investments: Horizon 1 drives revenue from core offerings. Horizon 2 incubates new bets to find the next $10M product line. Horizon 3 lays the foundation for future growth by exploring cutting-edge technology and long-term bets.
Separating investment teams by stage (seed, growth, public) creates misaligned incentives and arbitrary knowledge silos. A unified, multi-stage team can focus only on the handful of companies that truly matter, follow them across their entire lifecycle, and "never miss" an opportunity, even if the entry point changes.
