Investment Thesis: Strategy, Sectors & Scaling

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Investment Thesis: Overview

What is an investment thesis? 

• A VC investment thesis defines your focus areas and boundaries for investing.
• It helps investors filter out noise, concentrate efforts, and improve success rates.
• A basic investment thesis for venture capital can be framed as a Venn diagram of three elements: 
  
  • Sector/Domain: Industries or verticals you focus on
  • Geography: Where you invest
  • Stage: The maturity of the startups you back

This simple breakdown helps answer what is an investment thesis in practical terms.

What Drives Investment Decisions?

Sector/Domain

• Familiarity: Invest in sectors you understand from work, education, or experience.
  
• Affinity: Personal values or experiences may influence sector focus (e.g., legal tech).
  
• Interest: Past success in a sector (e.g., crypto) can shape future interest.

A strong sector focus is at the core of any VC investment thesis, ensuring investors don’t spread themselves too thin.

Geography

• Early-stage investing is often highly localised.
  
• Most angel investors focus on their immediate region (city/state/country).
  
• Cross-border investing may occur when there’s a personal or cultural connection (e.g., diaspora ties).
  

Stage

• Dictated by check size:
  
  • Pre-seed to Seed: 4–5 figure checks
    
  • Seed to Series A: Up to 6-figure checks
    
  • Series A & beyond: Requires $250K+ to multimillion-dollar checks
    
• Investing through syndicates or VC funds can give access to later-stage deals without needing large checks.
  

AngelSchool.vc Investment Thesis

The AngelSchool.vc approach is built on a structured, disciplined VC investment thesis that helps its global network make smarter decisions. This also serves as a practical investment thesis venture capital example for new angels to emulate.

Sector

• Focus on B2B technology and software.
  
  • Software enables fast iteration and traction.
    
  • Avoids hardware complexity and high upfront costs.
    
  • Fewer long-term dilution risks due to digital scalability.
    

Geography

• Global focus: US, Europe, and Asia.
  
  • 1300 investors split into regional clusters.
    
  • US cluster is most active; Europe and Asia clusters are growing.
    

Stage

• Primarily invest in Seed to Series A.
  
  • Occasionally pre-seed with traction.
    
  • Typical cheque size: $100K (pre-seed) to $1M+ (Series A).
    

Strategy: Grow investor network to increase cheque size and access later stages (Series B/C).