What We're Hunting - Thesis Led Investing

By Kathleen Osgood
2/22/2021

When seeking unique investment opportunities across the venture ecosystem, we spend much of our time “hunting” and not necessarily “gathering.” In recent years, the majority of our deals were outbound in thesis areas vs intros from our network. Our operating DNA blended with our insatiable desire to learn and dig in further ultimately drove us to this approach.

What is thesis-led investing at Jump? For starters, it means you can’t just have a FinTech thesis. Simply put, there are too many sub-sectors and markets from consumer finance to compliance tech and everything in between, in which to focus. Our theses thus focus explicitly within nuanced sub sectors and emerging new areas, and we begin hunting by talking with industry leaders to get perspective on pain points and trends and of course conversations and debate...lots of debating!

In the years at Jump, we developed our theses, conducted our hunting and made investments fairly under the radar. However, we feel there is value in further showcasing our perspectives as venture investors through speaking panels, blog posts and (soon) a podcast. It’s important, so we get more conversations going and hear different perspectives while also meeting great entrepreneurs. With that in mind, we thought it would be valuable to highlight the areas where we are hunting in 2021. Please take a quick read and if you or someone you know wants to chat (or debate) please reach out to [email protected]

Thematic umbrellas

Media

Sportsbetting / Media

It’s no doubt that the sports betting market has grown as states have opened, and that consumers are excited to wager. Most exciting to us is the millions of people who will make their first bets in the next few years. While it’s a competitive market for betting platforms, we do still see room for clever formats that cater to the unique American bettor. We also see tremendous opportunity in related media to educate and engage those new bettors. What platforms will future bettors congregate on, and what content will they read or watch? We are also very interested in how media companies will leverage betting to increase engagement, or to monetize audiences.

Tools for Creators

Over the past decade there has been a revolution in content production and distribution, which has democratized the space and enabled any creator to develop an audience. Creators in all fields - photography, music, video, written stories, etc. - have unprecedented opportunity, but many operate as one-man vertically integrated studios, handling their own development, production, post-production and marketing. A world of tools is evolving to serve these new artists, and we are interested in the platforms that help artists scale and succeed.

FinTech

Crypto

We believe that bitcoin is akin to digital gold for modern portfolios, cryptodollars are a new global money movement rail, DeFi could dramatically broaden the accessibility of financial services, and gaming could be the next killer use case for crypto. Based on these beliefs, areas targeted for investment include brokerages/exchanges around the world, interest-bearing account providers, borrow/lend technology providers and intermediaries, stablecoin applications, DeFi aggregators/interfaces, next generation blockchains, and gaming infrastructure.

Investing & Capital Markets

We are excited about platforms that are enabling investor access to fractional ownership of alternative assets which were previously only accessible to the ultra wealthy. We also believe there are significant opportunities for technology to enable financial advisors to deliver comprehensive digital wealth management services and for 401(k) providers to better serve employers and employees.

Compliance

Compliance spend continues to rise, and we are looking to invest in next generation compliance and risk management solutions. Of particular interest are AML/KYC, user onboarding, and counterparty due diligence solutions that enable financial institutions to meet rising regulatory requirements.

Insurance

Insurtech companies are driving an evolution of the insurance industry and creating a slew of new opportunities across the areas of policy administration, underwriting, claims, incidental distribution and annuity & insurance sales enablement tools.

IT & Data Infrastructure

Machine Learning Ops

Production deployments of Machine Learning models are increasingly complex. As more and more applications become “Intelligent Applications”, we will need infrastructure for enabling ML transparency & deployment at scale.

Data Privacy

As privacy regulations accelerate across the US and globally, enterprises will need to re-architect their data infrastructure to better protect their customers’ privacy and de-risk themselves.

Cloud-Native Infrastructure

Enterprise IT Infrastructure is witnessing major architectural shifts ranging from cloud migration, workflow / data pipeline automation and self-serve / “citizen developer” capabilities. To successfully enable these architectural shifts, a modern and cloud-native approach to application deployment, monitoring, data management and security is needed. We are very excited about this next phase of infrastructure build.

Test Automation

As the Software Development Life Cycle (SDLC) has evolved, we have seen significant innovation and investment in developer focused tooling, application deployment and monitoring. Our viewpoint is that QA testing and debugging capabilities have yet to evolve to serve the agile release cycles and this creates an exciting opportunity.

Quantum Computing

Quantum Computing is a paradigm shift and has the potential to enable exponential improvements in current infrastructure. In the last decade, this sector has evolved from being a science project to be at the verge of changing enterprise processes as we know them. We believe that we are some time away from pure application companies but very excited to find opportunities at the full stack or abstraction layer to power real world use cases.

B2B SaaS

Enterprise Automation

We believe that next generation Enterprise Automation will transform the nature of work and the workplace itself. Driven by significant advances in Machine Learning, Robotics and API driven software development, automation initiatives will drive significant economic growth. We have invested heavily in automation of multiple functional areas ranging from IT, legal, risk, cybersecurity, and process automation and will continue to identify new areas ripe for large scale automations.

The (Re)Skilled Labor Market

Increasingly the transportability of skills is becoming the currency of careers, simultaneously increasing the need for workers to build and enhance existing skills for job mobility and job advancement. Providing workers with the skills and credentials necessary to both obtain and advance employment which will require technology platforms integrated with a service layer.

Deskless Workforce Tech

Recruiting talent has increasingly moved across borders and outside of traditional office space while simultaneously the competition becoming more fierce to find the best in breed.

With advancements in devices and connectivity, the ability to serve a more diverse group of workers has significantly improved. These solutions will solve for new gaps in day-to-day work including communication, engagement, recruitment, and job satisfaction.

Better Purchase / After Purchase

90% of solutions for retail are focused on customer acquisition. It is now more expensive to acquire a customer than ever before - with these drastic upfront costs, we’re searching for solutions that enable brands to retain customers and build lifelong loyalty.

Composable Sites

The rapid acceleration of e-commerce and the closure of physical locations has reinforced the website as storefront. One major holdback for innovation of that digital customer experience is the monolithic and sluggish site architecture most brands and retailers use. Could now be the time that brands embrace re-platforming to headless and composable stacks?

The Dream of Checkout Anywhere

A network of affiliate links ties together listicles and ultimate purchases; influencers and publishers monetize through clicks that take customers on a circuitous journey in which only some transact. What stands in the way of effortless checkout from anywhere, and across multiple retailers?

Entertaining Shopping Experiences

The vast majority of e-commerce experiences are intent-driven, tied to search and browse without room for real discovery or fun. We see enormous opportunity for a new retailer to offer authentic, engaging content-driven experiences that consumers will be excited to shop.

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If you're an investor or founder in any of the above areas, please reachout to [email protected] - we'd love to chat.

By Kathleen Osgood
2/22/2021

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