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Investment focus: areas I look at, themes I like

At Connect, we are generalist investors singularly focused on product companies: highly efficient businesses whose key lever is their software products.
Product companies that become venture-scale are built by few and loved by many.

Sitar, Rory, and I form an equal, collegial partnership. We work very collaboratively in sourcing and assessing investments. While we share the same passion for great founders building products loved by many, each of us has a few areas of interest in which we strive to be a prepared mind.

On this premise, these are the (new and established) areas and markets I’m most interested for investment opportunities.

Areas of investment

In neutral alphabetic orders 😇

• Enterprise 4.0. a.k.a Industrial automation. I am excited to see software and vertically applied AI redefining massive and complex offline industries (manufacturing, energy, transport) via new industrial integrated solutions that create a 10x customer experience and moats. Industrial sites and energy providers are fast adopting software best practices with IT-OT convergence, with new opportunities in monitoring/observability.
• Cybersecurity. Application and infra, identity, hardware, industrial companies. We are proud first investors in Metomic and Aikido. Micro theses that help navigate the space: shift to “assume breach” and zero trust; increased risks and compliance push security tech to trickle down from enterprise to SMEs; the Rise of OT Automation and the Convergence between IT/OT; LLMs rise (of course) and its impact on cyber innovation.
• Data and AI-Ops. Focus on the new modern data stack and the data-centric AI movement: data streaming, data quality, LLMs observability, governance/compliance.
• Dev(Ops) tools, “picks and shovel” infrastructure. Past investments in include Cerbos, Magic Bell, TrueLayer. One particular huge space to watch is infrastructure and business resilience where there are new opportunities to innovate in observability software to address the unmet needs for compliance, control and cost-saving from skyrocketing observability bills.
• Horizontal Software. We look for products that are highly specialised by stack. I am currently actively looking into the RevOps and Dev-Ops stack. I am especially interested in GenAI native products, like Dust or Embedd (ML-generated drivers for semiconductors).
• Super SaaS. a.k.a Software + something layered above or below. I characterise it as a T-shaped proposition. A horizontal tool superpowered with a vertical something: a transactional/payment system, a productised professional service, 😎 even hardware, robotics or physical products. These companies combine the scalability and efficiency of software with traditionally hard-to-automate “parts” of the value chain and create ultimately more valuable businesses. Examples of this playbook are Soldo and PurpleDot
• Vertical Software. Here founders leverage industry-specific expertise and insights to drive digital transformation, have GTM advantages and access to hard-to-find data. I have already invested in E-commerce (PurpleDot), Travel & Hospitality (Lanes&Planes). I am looking to invest in more vertical software, including Advanced Manufacturing, Climate Engineering, Energy; Food and Farming; Industrial workplace Safety; Smart City; Supply Chain; Transportation & Logistics, and Robotics. And it is not only me pursuing B2B vertical markets at Connect. My partner Rory invests in the Financial Services and Insurance verticals (Intropic, Ophelos, Swallow + one in stealth). My partner Sitar invests in vertical networks in Health (LifeBit, Stitch, Faks, Trialing), Education (Woolf), TechBio, Gaming and general infrastructure for large Consumer applications (Ambient, Carter Api).

High conviction

I am more likely to build high conviction faster on value propositions that show some of these attributes:

• must-have. I call it mission-critical software. Highly compelling products that solve an urgent pain with an indisputable ROI, provide a solution necessary to the customer’s core business, improve the customer’s end offering dramatically
• bundling: consolidation of single point solution into a unified platform.
• full stack vertically integrated system — from the data collection to the final output- that 10x the automation, the control of the customer experience and increases the unit economics of the businesses
• compelling market dynamics, i.e. a strong “why now”: changed demand drivers, new technology or a platform not available before, compelling tailwinds such as sustainability and climate tech, new regulations
• technical edge, hard to build, architecture as destiny. Developers are users or co-users (going left movement)
• distribution superpower: PLG, network effect, vertical domain, community-led
• opinionated and loved by many (Connect trademark)

There are more huge problems to solve than ever, and there has never been a better time to start a company. 🤌 If you are a founder building in one of these areas, we would love to chat.