After the incredible pace of 2021, tech has definitely pulled back in 2022. But through it all, we remain focused on investing in outlier talent with big missions and developing theses in emerging areas. In other words, we haven’t changed our philosophy or how we invest. With every investment (no matter where we are in the roller coaster ride of the tech market), we ask ourselves “Why this mission-driven team?” and “Why now?”

And it’s within this framework that we reflect on 2022: our focus on outlier talent and emerging areas. 

On outlier talent with big missions

We made five new investments this year: 

Peaze (led by Parker Cardwell and Arman Vaziri) gives developers an SDK that enables frictionless Web3 user experiences through familiar authentication and payment methods, making Web3 UX indistinguishable from Web2. You can read our announcement here.

Remio (led by Jos van der Westhuizen) marks our first VR investment! The startup connects business teams in VR, merging game-like features with collaboration tools in one platform to help overcome some of the challenges of distributed teams and remote work.

Shellworks (led by Insiya Jafferjee and Amir Afshar) is a London-based biotech startup creating petroleum-free, compostable packaging, which “performs like plastic” but breaks down in about a year. You can read about their mission on TechCrunch: “Shellworks wants to crack makeup’s single-use plastic problem.”

We also made two investments that have yet to be announced: one empowering inbound enterprise sales, and the other transforming education with a P2P social platform. Stay tuned for more information on these companies shortly.

And our mission-driven founders continue to build category leading companies, collectively raising half a billion dollars in follow-on capital this year. They’ve achieved many accolades and launches as we summarized quarterly: Q1, Q2, and Q3 (our Q4 review to follow in a few weeks).

On developing theses in emerging areas

While our North Star is to invest in mission-driven founders at the earliest stages, the second most important criterion is “Why now?” What are the tailwinds that support the timing of this venture? Why is there a market pull today that didn’t exist last year or the year before? With this said, we spend much of our time in emerging areas like climate/energy and crypto.

We recently blogged about how despite the general slow down in tech, climate/energy has stayed “hot” (no pun intended) with many companies working to address the climate crises, especially with the recent incentives outlined in the IRA. We wrote about some of the new climate and energy themes that are capturing our attention, and did a deeper dive into the circular economy. Generally speaking, we’re excited about how software can help climate solutions scale.

It has been a very challenging and bearish year for crypto, but we continue to be bullish as every crypto winter has brought on a new wave of innovation. We still believe that there are huge opportunities in decentralized networks, especially in DeFi, as well as the blockchain’s capacity as a “system of record”, especially now with the explosive progress of generative AI (another emerging theme we’re spending time on). For example, ChatGPT’s ability to generate content based on the entire Internet corpus will likely mean that we’ll need to sign everything to signify its validity (some more thoughts from Fred Wilson here).

On generative AI…it feels like we’ve seen decades of progress happen within the past month with the incredible models that have been built by OpenAI, Stability AI, etc. We’re excited to see what applications get built on top of these platforms, as well as how our portfolio companies embrace this powerful technology to make their internal operations more efficient and optimize user experiences.

If you’re enthusiastic about any of these themes (or for swinging for the fences) 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 year: especially to our portfolio founders for continuing to push hard to invent the future and create technology that makes a difference; and to our LPs, peers, partners, entrepreneurs, friends, followers, and our families for their support!

Best wishes to you and your loved ones this holiday season. See you in 2023!