Decades of Experience Creating Alpha in Emerging High Tech Verticals
“Our deep experience in both public and private investing will let us identify and participate with what we believe to be one of the most dynamic growth opportunities in the next decade. This will be the fourth time in my career I have identified a market opportunity to capitalize on a dynamic sector.
--Garrett Van Wagoner, 5 Time Winner, Lipper Performance Achievement Award
Van Wagoner Ventures Early Years
We spent our first few decades focusing on emerging technology investing, building two advisory businesses for larger organizations. The results: Outstanding performance and over $500 million in combined AUM. Venturing out on our own in 1995, our initial mission was to leverage our experience at prior firms to advise a family of 5 Mutual Funds, the "Van Wagoner Funds" (VWF) focusing on new technology verticals reaching $4 billion in AUM. During this time we were honored to win the prestigious Lipper Performance Achievement Award 5 times; no other fund manager has won it twice.
For over three decades, we have been analyzing and investing in transformative emerging technology companies. Here are 3 major technology transformations we identified and some of the solutions we committed public or private capital to:
Starting with the transition from mainframes computing to distributed architectures and applications (CPQ, DELL, MSFT, ORCL, SUNW),
From a voice infrastructure to data becoming the driving force of the telecommunications revolution (ASND, CSCO, QCOM, JNPR, NTRO),
Funding the pioneers in first generation internet infrastructure (AOL, NSCP), social and business applications (ARBA, AMZN, EBAY, IVIL, IWOV), cloud based infrastructure and big data solutions (3PAR, CVLT, STOR), mobile operating systems (PHCM), and other leading technology markets.
With each "Next Great Thing" it takes foresight and experience to identify, select and execute critical factors that make up successful investing.
Our expertise can't be found in "Tech Investing For Dummies". You can't google it. It takes decades of experience with glowing successes and some skinned knees. Only then can you apply the skills necessary to generate the returns sophisticated investors expect.
Venture Capital Genesis
We entered the venture capital business as a natural outgrowth of our technology investing when we realized our public securities investment process would be successful analyzing and selecting late stage/expansion capital private securities and would capture the arbitrage discrepancy between public and private valuations.
The asset allocation decision was very effective, with our first fund commiting over $300 million in late stage/expansion capital private securities, supporting 54 portfolio companies with a return multiple of 3.0x and an annualized ROI of 99%, including 25 IPO’s.
After the technology retrenchment beginning in 2000, the arbitrage between public and private late stage/expansion valuations disappeared and left the private investment sector for the first decade of this century.
VW Ventures Now
After the technology retrenchment and the mortgage crisis subsided in 2010, we began exploring industry niches in new technology verticals. Our interest was attempting to find new technology verticals and:
1. Pinpoint market segments with breakaway dynamics,
2. Identify transformational companies in the beginning stages of market acceptance,
3. Invest with top tier ROI potential, measurable impact and sustainability.
We quickly focused on a vision of a total transformation of transportation, a $16 trillion part of the global economy to a mobility interconnected, efficient, sustainable grid.
Although there were many first generation companies in this niche with great potential that failed: we all know sometimes being early is being wrong, we were convinced the technology advancements were starting to assure the success of this transformation.
Financing the “New Economy” Mobility Connected Transportation Grid
The due diligence and ongoing research and significant experience in recognizing new disruptive technologies fundamentally changing traditional vertical markets led us to sharpen our focus on the ROI potential of a mobility connected transportation grid.
By developing relationships with industry consultants, fleet managers, public officials and thought leaders we have used this domain expertise to reach the following conclusions:
The $1 trillion transportation vertical was being disrupted by “New Economy” start-ups utilizing software technology to design and integrate standard components creating fundamentally new solutions for global transportation markets
The OEM’s and their Tier 1 partners were likely to follow rather than lead allowing significant market presence to develop for the “New Economy” leaders in each of these traditional verticals
Lack of competition for deal flow stems from VC’s lack of focus on this vertical, being deemed too painful given past experience, too capital intensive or not enough disruptive technology for today’s VC models
Significant alpha will be generated in this vertical and Van Wagoner Ventures can capture it.