The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

20VC: Altimeter's Brad Gerstner on Why Supercycles and the Powerlaw is the Most Important Thing In Investing, Why Portfolio Diversification is the Opposite of Risk Mitigation and The #1 Question Brad Asks All New Recruits

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Oct 10, 2022
Brad Gerstner, Founder and CEO of Altimeter Capital, shares insights from a career that includes over 100 IPOs. He discusses the critical role of power laws in investing and how they shape decision-making. Gerstner emphasizes that true investment success relies on identifying 'super-cycles' rather than short trends. He also reveals the key question he poses to new recruits to gauge their hustle and how market timing impacts investments. With a rich background in finance, his practical wisdom offers a fresh perspective on navigating complex market landscapes.
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ANECDOTE

Early Inspiration

  • Brad Gerstner's father lost his factory job due to an acquisition, leading to bankruptcy and inspiring Brad's interest in finance.
  • Witnessing his father's struggle fueled Brad's desire to understand markets and value creation.
INSIGHT

Power Law Investing

  • Investing returns follow a power law distribution, meaning a few investments generate most profits.
  • Focus on the biggest trends and markets to take advantage of the power law.
ADVICE

Focus on Super Cycles

  • Don't just look at market size, focus on super cycles: large, long-term trends.
  • Examples include the internet, mobile, and cloud computing.
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