One of the biggest factors in whether you receive outsized returns as a VC is how your portfolio is constructed. A single investment can create outsized returns which can be lost if your portfolio construction is flawed. Our guest today is Alex Edelson, Founder and GP of Slipstream Investors, a noted and up-and-coming Fund of Funds who has done a lot of work in Portfolio Construction. We get his take and talk about his experiences in Venture and his thoughts on the current market conditions.
We also welcome back to the Tank, John Ruffolo of Maverix PE, to discuss the latest tech news and headlines across the venture ecosystem.
About Alex Edelson:
Alex is the Founder and General Partner of Slipstream Investors. Before starting Slipstream, he worked at QED Investors, a top fintech-focused venture capital firm with $3+ billion in assets under management. Alex joined as Nigel Morris's Chief of Staff and became the Chief Operating Officer and General Counsel. He previously worked at a fintech startup and spent seven years practicing law. Alex holds a J.D. and B.A. from the University of Michigan.
In this episode we discuss:
(00:00:59) News roundup with John Ruffolo
(00:23:56) Alex Edelson’s journey into Venture Capital
(00:25:48) Working as a Chief of Staff at QED Investors
(00:26:57) Being mentored by Frank Rotman and the QED Team
(00:33:54) The importance of providing context to a no over pure speed
(00:34:50) Why he decided to start investing on his own
(00:39:41) Early LPs that backed his vision
(00:40:52) How his investing thesis evolved after the initial conversations with his LPs
(00:42:18) The importance of seeing a lot of deals before investing
(00:43:26) Setting clear expectations with companies at what stage you are at in your cycle
(00:44:45) What Alex looks for to consider a deal a win
(00:48:31) How Alex mitigates risk with diversification and other strategies
(00:50:24) Why every round of financing is an opportunity to buy or sell
(00:52:19) The benefits of having early liquidity
(00:54:07) Redflags that can scare LPs from emerging managers
(00:59:36) How the current market is affecting his strategy
(01:00:44) Trends he is seeing in the market
(01:02:21) Best career advice he’s received
Fast Favorites
🎙- Favorite Podcast: Tank Talks, Venture Unlocked, 20 Minute VC, Sure Shot Entrepreneur
📰- Favorite Newsletter /Blog: Mark Suster, Open LP
📲- Favorite Tech Gadget: Cyclops Hammer
📈- Favorite New Trend: Work from home
📚- Favorite Book: Man’s Search for Meaning
🤔 - Favorite Life Lesson: Focus on what you can control
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Alex Edelson of Slipstream Investors on Portfolio Construction