Adventure Capitalist – Real-World Example

What Is an Adventure Capitalist?

An adventure capitalist is someone who takes incredible chances, invests heavily in companies with little risk, and takes a long-term view of investment. While most VCs focus on early-stage startups, some are beginning to make inroads into other industries. These investors are known as “adventure capitalists” because they have taken on companies in the early stages of development – usually at a high price point.

An adventure capitalist is someone who makes speculative investments in emerging industries. Typically, they make these speculative investments through an early-stage venture capital fund or another private investment vehicle.

Unlike traditional investors, adventure capitalists generally do not own common stock in their companies or have any expectation of receiving ongoing income from their investments. Their only goal is to make a profit.

Understanding Adventure Capitalists

VC investing may appear to be a high-risk investment, but adventure capitalists tend to be even more comfortable with taking risks in hopes of achieving a large return. Although the potential for a large gain is appealing, so is the ability to avoid significant risk in this fast-paced industry. When choosing investments, venture capitalists often personally contribute to the management of the companies they invest in.

Since its inception, the social media market has expanded rapidly. The industry is now worth hundreds of billions of dollars. With the likes of Facebook leading the way, there are many opportunities for adventure capitalists to back startup companies in this industry.

Throughout history, one of the ways that venture capitalists have made investments and gotten rich in the process has been through investing in technology and startups in these emerging new industries. It’s risky—but it can also produce huge rewards.

An adventure capitalist is a type of investor motivated by more than simple financial returns. While his investments may generate significant cash flow, this individual also considers the social implications of those investments as well as the potential for growth within an industry that has yet to blossom.

Adventure capitalists are risk-takers who look for opportunities in industries facing rapid change to find opportunities. They invest in rapid growth businesses, also known as startup companies, to benefit from first-mover advantages that come with the rapid change in the industry.

Real-World Example of an Adventure Capitalist

Emma has invested in more than forty companies and been a part of several successes. She has invested in over twelve companies that have collectively raised over $10 billion in funding as an individual or part of a venture capital fund. She has also advised companies on growing their revenues and helping them increase their profits through revenue generation strategies.

A natural extension of her work as an investor is her service as an introvert. She retreats from the public eye and prefers to work behind the scenes at companies that interest her. She describes herself as very social but says she is skilled at keeping a low profile and quieting anxiety that often accompanies speaking up in public.

She has invested in over thirty companies, including five companies that have advanced to Series A or B. Up to October 2017, she put up her entire net worth in cryptocurrencies – initially worth $3 billion – through her Pantera crypto fund, which she founded in 2015.

Her past investments include social apps company Waze, which was bought for $1.5 billion; Anoblytics, a maker of wristbands that track sleep and fitness; and Zimride, an online travel company that allows customers to rent zip-line machines in New York and Chicago. Recently, she has been focusing on early-stage technology startups, emphasizing investors like herself who desire to diversify their investments without putting all their eggs in one basket.

Her portfolio companies have generated over $3 billion in exit value (after-tax). She has also been a founding member of several venture capital funds and has served on the boards of several others. She was a co-founder of Office Wonderland, a 75 person virtual reality company that was a global media darling and went public at a $4.05 billion IPO in 2014. Before that, she was a venture capitalist at Greylock Partners, a multi-billion dollar venture capital firm.

Key Takeaways

  • An adventure capitalist is someone who takes incredible chances, invests heavily in companies with little risk, and takes a long-term view of investment.
  • Unlike traditional investors, adventure capitalists generally do not own common stock in their companies or have any expectation of receiving ongoing income from their investments. Their only goal is to make a profit.
  • Venture capitalists often personally contribute to the management of the companies they invest in.