Lone Wolf

survival

Wolves are inherently social animals

Like humans, wolves have complex social structures that enable them to hunt, reproduce, and survive

Survival depends on strength in numbers

Every so often, a wolf is driven from the pack and forced to survive on its own; a tale as old as time

The lone wolf that survives tends to be much more aggressive and stronger than a wolf belonging to a pack

Today we want to scope out some lone wolf investors - or solo capitalists - that are making a killing

1. Elad Gil

Elad Gil is one of the largest solo VCs of all time

His academic and professional background includes an MIT PhD, McKinsey, Google, and Twitter to name a few

Gil got his first break after selling his startup, MixerLabs, to Twitter. The acquisition was for an undisclosed amount in 2009, so likely not a life-changing win

But at Twitter, he worked his way up to VP of Corporate Strategy before becoming a co-founder / CEO at Color Genomics

Along the journey, Gil started putting money to work as an angel investor because so many people were looking for his perspective on deals

Investment Track Record:

• Airbnb

• Coinbase

• Flexport

• Gitlab

• Stripe

• Pinterest

• Instacart

To date, this lone wolf has taken a bite out of more than 30 unicorns

Last December, it was reported that he raised $1.1B from 54 investors for his third solo fund

The new raise brought Gil’s total to $2B+ raised in the past five years

An interesting aspect about his investment strategy is how he prioritizes product-market fit over the founders

Product-market fit: being in a good market with a product that can satisfy that market

• first coined by Benchmark Capital founder Andy Rachleff

Gil’s last raise brought in institutional investors like Harvard’s endowment fund

On the flip side, Elad has experience playing the LP role as well

Alana Goyal is a member of this year’s Forbes 30 under 30 class, recognized for founding Basecase Capital

• According to Forbes, Goyal reached out to Gil after he invested in her husband’s company. She wanted advice on how to get into VC

• Gil decided to give her $600K of his own money so that she could learn how to angel invest

• After less than a year of research and investing, she quit her product manager job to launch Basecase Capital in 2021. Currently has $99M AUM

2. Josh Tarasoff

Josh worked at Goldman Sachs after graduating with a Philosophy degree from Duke in 2001. After reading a book on value investing, he decided to attend Columbia Business School. It was at Columbia that he began investing out of his own account and doing deep research on public companies

He went on to bootstrap an investing firm named Greenlea Lane Capital post-graduation.

Josh moved into a cheap apartment with some friends, raised a $2.3M from friends and family, and began his journey as a solo investor trying to beat the market.

This was 2006.

Today, Tarasoff’s Greenlea Lane has grown to $450M AUM

• 17%+ IRR net of fees

• No additional investment team members

• No formal office

• No marketing

As he grew, a focus on “radical simplicity” kept him grounded. Tarasoff believed that taking on additional expenses due to convention was a mistake. He watched other managers hire analysts, take on large office spaces, and increase their costs of doing business.

In essays on investing found on his site, Josh lays out principles that drive his investing career, and by extension, his life

• Long-termism: he noticed that investors are often under time pressure to come up with new ideas; a pressure that leads to countless mistakes. So he took a contrarian approach: treat each investment as an infinite hold. This framework introduced an incredibly high barrier for stock selection and also reduced time pressure / unnecessary error

• Implicit Conviction: explicit conviction is the quantitative vector of conviction. i.e. this company can acquire this % of the market. implicit conviction is a more qualitative type. i.e. trust in the company’s mission and management. Josh emphasizes the need to balance explicit-implicit conviction tension as a long term investor

• Endgame: think about how the world will look 10 years from now and where you have the most conviction. Example: Years ago, Tarasoff believed that online retail will eventually take over offline retail, and the online retail space will be much less fragmented, allowing a few major players to reap in large profits. Today, one of his most notable winners is Amazon.

Greenlea Lane’s portfolio has some recognizable names:

• Amazon

• Berkshire Hathaway

• Brookfield Corp

• Google

• Market Group

• Microsoft

Both of these individuals offer invaluable insight on the importance of starting small and embracing uncertainty.

Perhaps the next solo stepper is reading this now

Headlines

• Brazilians flock to Bluesky after country bans Elon Musk’s X. FT article here

• Elliott now owns enough of Southwest Airlines to call special meeting. Reuters article here

• SparkLabs closes $50M fund to back AI-startups. TechCrunch article here

• College basketball programs are hiring general managers. CBS Sports article here