“The time to buy is when there’s blood in the streets” — Baron Rothschild
It seems obvious, but it is against human psychology. It does not matter that fortunes have been made throughout history with crisis investing, by taking advantage of the semi-hidden opportunities.
And apologies for the common place; the Chinese symbol for crisis is a combination of the symbol for danger and the symbol for opportunity. The danger is what even the rocks see; the opportunity is never quite as evident as the danger, but it is always there.
We proudly announce the first closing (it will stay open for one year) of Fabrica Ventures VC Fund 2.
We started Fund 1 in July 2020, in the middle of the pandemic. 74 investors believed in us, much obliged! We focused on US, late-stage, tech and B2B. We put together a seasoned skin-in-the-game advisory committee. With them we managed to invest in 26 unicorns that were totally adherent to our investment thesis.
Now, with Fund 2, we are repeating the formula. And, gladly, most of the investors of Fund 1 decided to continue this journey with us. Thus, we were able to begin Fund 2 with practically the same size as we ended Fund 1.
As an investment rule, investors should try to “make the trend their friend”. And, indeed, technology is a secular trend. But there are always inflection points in trends, like the one that happened in 2022.
Because of this, startups’ valuations in secondary markets are, on average, 40% down from their last funding rounds that happened 1-2 years ago. Because they have doubled revenues since then, the multiples we will be paying in Fund 2 will be ≈70% below their peak – what a great opportunity!
Now it is the time not only to invest in great startups, but also at great prices.
Investors in both Fabrica funds shall hold then a portfolio of 50 great names and we do not have any doubt that several will become blue-chip public companies and bring excellent returns.
Again, THANK YOU Fabrica LPs for recognizing a time of opportunity in a time of danger!
“It’s not a faith in technology. It’s faith in people.” – Steve Jobs