Alex Chachava: Venture capital is taking over other investment assets
Alexander Chachava, a Managing Partner at LETA Capital, explains how the pandemic affected startup financing and why the changes will be long-lasting.
We are entering an era of post-pandemics. The world is gradually adapting to the permanent turmoils and learning how to live in the new reality. The epidemic has affected all aspects of our lives and the structure of the global economy. Businesses were forced to restructure their core processes on the fly, while precisely monitoring the performance of financial instruments. On the other hand, the macro-trends that move the markets have remained unchanged. Meanwhile, the pandemic has revealed what is important strategically and what is tactical; even more, it defined the guidelines of economic development for the upcoming years. Let’s put ourselves in the shoes of an investor who wants to invest today, say, a million dollars in a potentially high-yield financial instrument.
The key question is: do the first-time investors who realized that money should work have appropriate tools for this? In fact, there aren’t many choices. We will deliberately ignore speculative or excessively volatile instruments (cryptocurrency, microlending, etc.), as well as rather conservative and low-yield instruments (government bonds and securities of “heavyweights”). Instead, let’s cover only those investment tools that can beat inflation.
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