2018: Year in review and a look ahead

2018 was a big year for Version One, and it’s hard to believe another year is drawing to a close. We invested in seven new companies and participated in many follow-on rounds. Of the new investments, one is in encryption, one is in security, one is in consumer hardware, one is in bio/healthcare, and three are in crypto/blockchain.

We spent a lot of time in bio/healthcare and crypto/blockchain in 2018 and will continue the trend in 2019…

Crypto/blockchain

After the 2017 price run up, reality set in during 2018; both BTC and ETH value plummeted. Some say that we are in “crypto winter.” Lots of ICOs and capital poured into the frenzy of this market in 2017. Now as projects are developing, it is clear that blockchain technology is still in the early stages. There are some fundamental issues to be sorted out, including volatility, fiat-to-crypto on-ramps, and scaling.

Yet we continue to be bullish about the long-term potential of this technology and are investing in companies that are building native applications to leverage the specific strength of the underlying platform… in this case trust without a third-party intermediary.

Following this thesis, we made the several investments in 2018:  

CryptoKitties: a game centered around breedable, collectible, digital creatures that is starting to show the potential of programmable assets

Celo: An open platform for fast, secure, stable digital payments to any mobile number at a fraction of today’s cost.

Lolli: gives customers bitcoin when they shop online (n.b. This helps encourage the mainstream adoption of cryptocurrency).

In addition, our existing startups in this space continue to do well. For example, Coinbase raised its Series E this quarter.

Bio/healthcare

US VC deal flow in healthcare hit an all-time high this year as we continue to refine our thesis on the space. We’re focused on vertically integrated startups that empower consumers and companies to collect health data easily and affordably, to become a “biobank” where this data can power personalized recommendations.

We’re looking forward to sharing details on a recent investment. The startup’s at-home test has the potential to not only improve access to certain diagnoses and treatments, but by doing so, also change the cost structure associated with it.

Transitioning to Fund III

What made 2018 especially big was that we raised Fund III. While we have expanded our partnership to two GP and have a bigger fund, our fundamentals stay the same: we invest at seed / pre-seed, in companies that leverage network effects, and across North America (hubs are SF, Toronto/KW, NYC, Seattle).

This should serve as a reminder that while we are spending lots of time in crypto and bio, we are still excited about network effects that exist in VR/AR, autonomy, etc., and love marketplacessocial platforms, and Smart SaaS. If you’re enthusiastic about these themes as an entrepreneur, investor, or operator, please reach out!

And finally, we wish to thank everyone who has been a part of the Version One community for this incredible year, from our LPs, peers, partners, entrepreneurs, friends, followers, and our families. We wouldn’t be here without your encouragement and support.

Best wishes to you and your loved ones this holiday season. See you in 2019!

~ Ange & Boris 🙂

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