NXTGEN

FIRST PRINCIPLES OF INVESTING TO STEWARD INNOVATION

First-principles based investing helps anchor our fundamentals required to assess, review and manage our investments. It helps us remain focused on our why.

We measure things by their impact. Whether it is a positive customer experience or a family vacation, we express our level of satisfaction based on how that experience made us feel. Good or bad, our emotions are temperamental. The question we then need to ask ourselves is, ‘how do we consistently deliver more positive experiences for our customers?’ The answer lies in getting back to the basics; the first principles.

In our world of investing, investors view their world through different lenses. Our filter, or something we refer to as our gravitational lens, pulls us back to our first principles of investing.

First-principles based investing helps anchor our fundamentals required to assess, review and manage our investments. It helps us remain focused on our why.

We are going to treat this thought-piece as somewhat of a live document. It is one of those pieces that are shaped by continual refinement. In essence, I suppose it’s a deep dive into the applications of key learnings that really cause us to reflect on changes that may shape our thinking at a deeper level. 

So let’s dive in.

At the core of our why lies this phrase: “stewarding innovation”. 

‘Steward’ comes from the Old English word ‘stīweard’ which is derived from ‘stig’ being house(hold) and ‘weard’ being guardian. It was a title used in the early 17th century to describe an officer controlling the domestic affairs of a royal household. 

When we pair this with our lineage, talking about stewarding innovation for us has a far deeper and more personal meaning. 

It combines promoting innovation with expanding the influence and operations of the royal household.

Stewarding innovation is about responsibly investing into and and guiding the process of bringing to market new technologies, products or services by:

1. Advancing innovation aligned with our mandate, and
2. Maximizing their potential benefits.

Broadly speaking, it encompasses these 5 areas:

• Sourcing and picking
• Deal making
• Asset management
• Fund management
• Fund harvesting

There are a series of questions we ask when we are sourcing and looking at deals, and there are certain frameworks that guide our decision making. The purpose of putting this together is to share some of our learnings. Whether you are an investor, entrepreneur or capital allocator we invite you to learn with us and share your thoughts in your quest for stewarding innovation.