103. How I got into deep tech investing (with Colin Beirne, Two Sigma Ventures)

“There are things that are much more important about investing in technology companies than technology,” says Colin Beirne, Founder of Two Sigma Ventures. TSV has invested in around 100 start-ups over the last 10 years, and funded 10 unicorns. They’re part of Two Sigma, a hedge fund with more than $60 billion under management.

Colin is surrounded by data scientists and programmers, but doesn’t have a background in programming. Listen to this episode to hear how Colin went from a liberal arts college to becoming one of the world’s leading deep tech investors.

Learning notes from this episode:

• “The winning company is not always the one with the best technology. Tech can be a differentiator, but usually it’s only temporary. The job of a venture capitalist is not to figure out which company has the best tech. It’s to figure out which company has the best business that can ultimately be the biggest impact,” says Colin.
• Data science and knowing how to analyse data to spot trends is domain agnostic. This is why you often see data scientists changing jobs from completely different fields, such as going from insurance to social media. 
• Companies across industries can and do use data analysis to make better decisions at scale. Media companies do this when serving us content and advertising, and investment firms do this to decide which companies to invest in.
• To decide whether joining a start-up is a good idea, evaluate the founders: do you think they have the ability to grow a successful business?

Resources mentioned in this episode:

• Tech for Non-Techies podcast: Lessons from the Netflix C Suite 
• Tech for Non-Techies podcast: The Business of AI with Harvard Business School Prof Marco Iansiti
• Book: Competing in the Age of AI Strategy and Leadership When Algorithms and Networks Run the World 
• Book: How Generalists Triumph in a Specialized World

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