Investing Thesis
What is the best process for developing an investment thesis?
An invest thesis tells a convincing story backed by maths.
Purpose
The goal of writing a thesis is to judge conviction that an investment will generate compelling returns. Keep your thesis succinct and focused on the most important factors driving your investment decision.
Checklist
High-level checklist for creating an investment thesis to build a picture of how, where and when value will accrue before committing to a decision strategy for controlling your position.
- Identify the underlying catalyst or trend driving the investment opportunity
- Assess how the specific investment is positioned to benefit from the catalyst
- Consider the biggest risks and potential downsides
- Determine your conviction level and expected return
- Write a concise statement (1-2 sentences) summarizing the investment thesis
- Include key supporting data points and analysis
- Outline your planned investment timeline and exit strategy
- Review and refine the thesis as new information becomes available
- Use the thesis to guide future decisions about the investment
- Be prepared to abandon the thesis if fundamental assumptions prove incorrect
Details
- Intentions: Clarity and consistency of direction.
- Culture: The commitment of the community and their meme game.
- Business Model
- Business Development
- Engineering Principles
- Tokenomics
- Flows
- Memetics
- Leadership
- Web3 Principles
- Narrative and Goodwill
- Community and Network Effects
- Developer Experience
- Token Economics
- KPI Metrics
Questions
Fundamental questions to ask before committing to an investment:
- How many are going to buy this?
- Why are they buying?
- What time horizon?
Convictions
- Culture will have the greatest impact on liquidity and accrual of value.
- The games we choose to play form the strongest cultural bonds across widest cross-sections of society.
- Goodwill is hard won but easily lost, you can never afford to lose people's trust and faith,
- The data layer is the most valuable layer in the tech stack.
- Intents and Interoperability will provide a layer of abstraction (via standardization) above blockchains, where AI will automatically send intents across network arbritrage opporunities based assessment of risk vs reward profile and opportunities.
- AI automation, Blockchain Integrity, Crypto Incentives, Internet of Signals in a closed feedback loop is the loop of the endgame.
- Decentralization and security won't matter until we learn the cost of failure.
Components
Investors
Thesis from notable players in investing and crypto:
Attachments
Links
What is the most important question you could ask yourself to make progress?