Thought Leadership Threads
Frank Rotman
@fintechjunkie
There’s a lot of mis-information being shared about VC performance and how it translates into LP returns.
There’s also a lack of understanding about how the VC ecosystem broke the LP ecosystem over the past few years and why this matters A LOT.
Here’s what’s going on:🧵👇
Frank Rotman
@fintechjunkieIt used to be common for a startup to de-risk in distinct phases that aligned with capital raises.
Discipline disappeared and the number of rounds a typical startup raised exploded into “alphabet soup”.
The market is returning to “normal”. Here’s what you need to know: 🧵👇
Frank Rotman
@fintechjunkieVCs didn’t know what fintech was until giants emerged like Stripe, Credit Karma and NuBank.
Then every VC wanted fintech exposure. But these “fintech tourists” have exited the building.
What follows is advice 8 VCs who stayed the course are giving their fintech companies.🧵👇
Frank Rotman
@fintechjunkieOver 100 startups in our portfolio have refactored their operating plans in the past year.
Some have become profitable with as little as $5MM of revenue while others have found ways to do more with less.
Can you guess the four most common levers they pulled?🧵👇
Frank Rotman
@fintechjunkieMemecoin trading is back with marketcaps for select coins exploding by 5X, 10X and sometimes even 100X+.
Over the past few days I talked to traders who hold anywhere from $500 to $20MM+ of memecoins.
Their views are eye opening! 🧵👇
Frank Rotman
@fintechjunkieA disturbing change to society over the past few decades is the number of people addicted to “unearned dopamine”.
Having spent countless hours with high stakes poker players and professional day-traders, I’ve seen the fallout. It can be ugly!
A few thoughts:🧵👇
Frank Rotman
@fintechjunkieThe biggest fallacy in the Startup world is to believe that the entry price for a great investment is irrelevant.
While great investments generate great returns, being indifferent to price is a function of sloppy thinking.
A useful mental model that great Investors use:🧵👇
Frank Rotman
@fintechjunkieThere’s a major structural flaw in how the VC ecosystem works that we don’t talk about enough.
It’s a flaw that creates confusion and bad advice for Founders.
And it’s a flaw that makes no sense when you dissect it. 🧵👇
Frank Rotman
@fintechjunkiePeople constantly wonder why the US has so many Banks compared to other countries!
Are you wondering if the US system makes sense?
Do you want to know where it's heading?
Here's some history, charts, and thoughts: 🧵👇