Assertion Supported
Alter: European VC funds beat North American funds in 10-year net IRR
“It's not surprising that when you, again, look at the numbers over a 10 and 15 year time horizon, European VC funds have yielded higher net IRR compared to North American ones.”
Opinion
Alter: Vertical AI offers more exciting opportunities than horizontal or foundational models
“I'm thinking a lot these days about vertical AI and really, you know, the opportunity there being More exciting than sort of horizontal or even foundational layers in AI at the moment.”
Insight
Alter: World-class company building requires rare, Olympic-level founder intensity
“Like one thing I learned from Emory, who's the CEO of Frame.io is is that there's no match for intensity. You need it. And he once gave me this really powerful analogy where he said, if I was training for the Olympics of figure skating Nobody would ask me, do …”
Opinion
Alter: VC firms shouldn't be political because LP metrics are completely objective
“VC has real metrics. Like we have numbers on a page that we're showing to our LPs that we are accountable for. And obviously, you know, sometimes those investing cycles can be long. So sometimes it takes a little bit of time for the numbers to really be clear,…”
Opinion
Alter: GDPR has become a global standard that actively inhibited tech businesses
“Like GDPR, which first of all has now become a global standard, so I don't think it's specific as much to Europe anymore, but You know, that definitely has inhibited many tech businesses, so there's always nuance and shades of gray.”
Insight
Alter: Combining SaaS, AI, and FinTech creates more defensible businesses
“It's not SAS only SAS. It's not only AI. It's never going to be only FinTech, but the combination of these things together makes for a truly defensible, resilient business that, that I think is going to be really large.”
Insight
Alter: Junior VCs Can Differentiate by Exploring Complex Topics Senior GPs Avoid
“You know, there are so many opportunities to differentiate yourselves. And one of the easiest opportunities I found is to actually look into the boring and complicated stuff that, you know, more senior GPs, Don't want to look into.”
Insight
Alter: Deal droughts and sunk costs cause severe VC cognitive biases
“There's things like discovery bias, which is sort of the notion of, I found this investment, so I love it, and it's personal to me. Or there's sunk cost bias, which is really common as well. You know, I spent three weeks in due diligence, so I love it. Or, you…”
Insight
Alter: Fund size does not predict internal headcount allocation
“Just the overall size doesn't tell you that much, but when you dig into the actual composition of the team, you really learn what life at those firms will be like.”
Insight
Alter: Vertical AI moats come from workflow integrations and sector specificity
“What I see as the big opportunity with vertical software is you have these spaces like legal tech or construction, manufacturing, software for hardware, healthcare that are very specific and you can create this sort of defensibility through leveraging that spe…”
Prediction Didn’t hold up
Alter: 2024 will be the third most active year for European VC
“You know, if the pace continues, I think twenty-twenty-four will become the third most active year ever for VC funding in Europe.”
Insight
Alter: Hardware incumbents persist because tooling shifts require changing physical processes
“A software team can really easily start using a new task management tool or a debugging tool without having to change their desk. But a manufacturing or design team would have to really shift real world physical processes in order to adopt any kind of new tool…”
Prediction Not checkable as stated
Alter: Declining birth rates and onshoring will drive software-for-hardware investment
“You have things like global onshoring, declining birth rates, which has more of an impact than you would think. And the threat of Chinese competition as well. These factors have lit a fire underneath manufacturing teams to push themselves on efficiency. And so…”
Assertion Not checkable as stated
Alter: Toyota, Boeing, and Samsung pay tens to hundreds of millions for legacy software
“Toyota we found pays Matlab, fifty million dollars a year. Boeing pays Simulink and MATLAB hundreds of millions. Samsung has an eight figure contract with Atlassian.”
Prediction Not checkable as stated
Alter: AI will inevitably disrupt legacy engineering and simulation software tools
“Simulation tools are going to have a moment and AI Is and will continue to come for them.”
Insight
Alter: Workflow SaaS is the essential delivery mechanism for unlocking AI's value
“I think workflow SaaS is the delivery mechanism that will allow AI to actually, you know, keep its promise.”
Disclosure
Alter: Northzone writes checks from $2.5M seed up to $60M growth
“So for check size, we start at two and a half million at the seed stage and go all the way up to 50, sixty million. At the growth stage the real bread and butter is, you know, 10 to 20, that's where the majority of our checks happen”
Disclosure
Northzone splits capital evenly between US and Europe with slight Europe tilt
“We're pretty evenly split between U S and Europe with maybe a slight a slight emphasis on Europe from a percentage dollars standpoint.”
Disclosure
Northzone led Spring Health Series A based on Scandinavian mental health trends
“In Scandinavia, mental health was actually a thing long before it was in the U S they're so progressive over there. And so people were taking care of their mental health and it was destigmatized. Whereas in the United States, it was still kind of, this is, you…”
Disclosure
Northzone backed Tandem Health after seeing US medical scribing market growth
“Medical scribing took off early in the US with companies like Abridge and DeepScribe. And we saw how quickly those businesses were able to grow and invested in a company in Europe doing the same called Tandem Health.”
Assertion Supported
Alter: European VC funding hit $30 billion in H1 2024, up 12%
“VC funding in Europe reached about thirty billion the first half of 24. That's a 12% increase to twenty-twenty-three.”
Assertion Supported
Alter: Spotify and Klarna alumni founded 70 venture-backed startups in Stockholm
“Spotify and Klarna alums have spawned 70 venture backed companies in Stockholm from two companies.”
Assertion Supported
Alter: Public SaaS average revenue growth is projected at historically low 16%
“In 2024, the average growth rate for public SaaS companies is expected to be 16%, super low, like relative to history.”
Assertion Supported
Alter: Government spending accounts for 36% of US GDP
“36% of U.S. GDP is spent on government spend.”
