Capital Allocators – Inside the Institutional Investment Industry Josh Wolfe – Caution and Innovation at Lux Capital, Venture is Eating the Investment World 8 (Capital Allocators, EP.236)
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Feb 21, 2022 
Josh Wolfe, Co-Founder and Managing Partner of Lux Capital, shares his cautious view on today's venture landscape and its implications for investment strategies. He discusses risks tied to inflated valuations, drawing parallels to the dot-com bubble while highlighting the necessity for skepticism. Wolfe delves into innovative topics like scent technology and advancements in nuclear energy, as well as exploring opportunities in Africa. His insights into managing partnerships and cultivating intellectual networks reveal the delicate balance needed for success in a competitive market.
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Venture Landscape Caution
- Venture capital is experiencing an "excess of excesses," with high valuations and deal velocity exceeding diligence.
- This unsustainable environment will likely lead to corrections, impacting returns and potentially causing significant distress.
Investment Strategy in Excess
- Focus on scarce assets like scientifically rigorous companies with strong IP moats.
- Avoid competing in over-saturated markets with high valuations and low diligence.
Control Labs Acquisition
- Josh Wolfe regrets not providing early liquidity to Control Labs founders, leading to their sale to Facebook.
- He learned the importance of aligning financial incentives with long-term vision for founders.