VC Decision Making (Online): Developing an Investment Thesis NEW

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VC Decision Making (Online): Developing an Investment Thesis

Create Your Own Venture Capital Strategy

Venture capital funding has experienced exponential growth in recent years. While the peak for venture capital in terms of dollar value has passed in the face of the global economic slowdown, the field continues to be one of tremendous opportunity — if you know where to find it.

In order to thrive in this fast-paced, volatile environment, venture capital professionals must stay abreast of trends and develop a solid investment thesis to help them navigate uncertainty and pinpoint viable opportunities.

Lead faculty Angela Lee is the founder of 37 Angels, an investing network that has evaluated 15,000+ startups, invested in 90+ startups, and currently activates new investors through a startup investment boot camp. Join us to learn how to create a successful investment strategy and decision-making framework to improve venture fund performance and intelligently diversify your portfolio.

Please contact our partners at Emeritus at  [email protected] , +1 315-982-5094, or +1 315-277-2746 for a personal conversation about this program and how it may benefit you.


By the end of the program, you will be able to:

  • Determine the best investment strategy for your portfolio
  • Establish your criteria for industries and business models to invest in
  • Understand the risk/return trade-offs between investing in different stages
  • Recognize and navigate trends that are transforming the venture capital market and uncover upcoming opportunities  

Program Structure

What Is Venture Capital?

Get a refresher on the venture capital industry and self-assess your current knowledge. Identify the venture capital players, risks, rewards, and funding stages, and navigate the venture capital deal flow process.  

Participant Profile

This advanced-level program is designed specifically for mid-career venture capital professionals interested in exploring the evolution of the venture capital landscape and identifying emerging startup trends and technologies in which to invest.

Representative roles include:

  • Venture capitalist
  • Venture partner
  • Limited partner
  • VC associate or senior associate
  • Portfolio manager
  • Financial advisor
  • Family office manager

Angela Lee, Professor of Professional Practice, Finance and Faculty Director of the Lang Center for Entrepreneurship

Professor of Professional Practice, Finance Faculty Director of the Lang Center for Entrepreneurship

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What Is an Investment Thesis?

  • Understanding the Thesis

Special Considerations

  • What's Included?

The Bottom Line

  • Portfolio Management

Investment Thesis: An Argument in Support of Investing Decisions

investment thesis education

Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee, and has a degree in accounting and finance from DePaul University.

investment thesis education

The term investment thesis refers to a reasoned argument for a particular investment strategy, backed up by research and analysis. Investment theses are commonly prepared by (and for) individual investors and businesses. These formal written documents may be prepared by analysts or other financial professionals for presentation to their clients.

Key Takeaways

  • An investment thesis is a written document that recommends a new investment, based on research and analysis of its potential for profit.
  • Individual investors can use this technique to investigate and select investments that meet their goals.
  • Financial professionals use the investment thesis to pitch their ideas.

Understanding the Investment Thesis

As noted above, an investment thesis is a written document that provides information about a potential investment. It is a research- and analysis-based proposal that is usually drafted by an investment or financial professional to provide insight into investments and to pitch investment ideas. In some cases, the investor will draft their own investment thesis, as is the case with venture capitalists and private equity firms.

This thesis can be used as a strategic decision-making tool. Investors and companies can use a thesis to decide whether or not to pursue a particular investment, such as a stock or acquiring another company. Or it can be used as a way to look back and analyze why a particular decision was made in the first place—and whether it was the right one. Putting things in writing can have a huge impact on the direction of a potential investment.

Let's say an investor purchases a stock based on the investment thesis that the stock is undervalued . The thesis states that the investor plans to hold the stock for three years, during which its price will rise to reflect its true worth. At that point, the stock will be sold at a profit. A year later, the stock market crashes, and the investor's pick crashes with it. The investor recalls the investment thesis, relies on the integrity of its conclusions, and continues to hold the stock.

That is a sound strategy unless some event that is totally unexpected and entirely absent from the investment thesis occurs. Examples of these might include the 2007-2008 financial crisis or the Brexit vote that forced the United Kingdom out of the European Union (EU) in 2016. These were highly unexpected events, and they might affect someone's investment thesis.

If you think your investment thesis holds up, stick with it through thick and thin.

An investment thesis is generally formally documented, but there are no universal standards for the contents. Some require fast action and are not elaborate compositions. When a thesis concerns a big trend, such as a global macro perspective, the investment thesis may be well documented and might even include a fair amount of promotional materials for presentation to potential investing partners.

Portfolio management is now a science-based discipline, not unlike engineering or medicine. As in those fields, breakthroughs in basic theory, technology, and market structures continuously translate into improvements in products and in professional practices. The investment thesis has been strengthened with qualitative and quantitative methods that are now widely accepted.

As with any thesis, an idea may surface but it is methodical research that takes it from an abstract concept to a recommendation for action. In the world of investments, the thesis serves as a game plan.

What's Included in an Investment Thesis?

Although there's no industry standard, there are usually some common components to this document. Remember, an investment thesis is generally a proposal that is based on research and analysis. As such, it is meant to be a guide about the viability of a particular investment.

Most investment theses include (but aren't limited to) the following information:

  • The investment in question
  • The investment goal(s)
  • Viability of the investment, including any trends that support the investment
  • Potential downsides and risks that may be associated with the investment
  • Costs and potential returns as well as any losses that may result

Some theses also try to answer some key questions, including:

  • Does the investment align with the intended goal(s)?
  • What could go wrong?
  • What do the financial statements say?
  • What is the growth potential of this investment?

Putting everything in writing can help investors make more informed decisions. For instance, a company's management team can use a thesis to decide whether or not to pursue the acquisition of a rival. The thesis may highlight whether the target's vision aligns with the acquirer or it may identify opportunities for growth in the market.

Keep in mind that the complexity of an investment thesis depends on the type of investor involved and the nature of the investment. So the investment thesis for a corporation looking to acquire a rival may be more in-depth and complicated compared to that of an individual investor who wants to develop an investment portfolio.

Examples of an Investment Thesis

Portfolio managers and investment companies often post information about their investment theses on their websites. The following are just two examples.

Morgan Stanley

Morgan Stanley ( MS ) is one of the world's leading financial services firms. It offers investment management services, investment banking, securities, and wealth management services. According to the company, it has five steps that make up its investment process, including idea generation, quality assessment, valuation, risk management , and portfolio construction.

When it comes to developing its investment thesis, the company tries to answer three questions as part of its quality assessment step:

  • "Is the company a disruptor or is it insulated from disruptive change? 
  • Does the company demonstrate financial strength with high returns on invested capital, high margins, strong cash conversion, low capital intensity and low leverage? 
  • Are there environmental or social externalities not borne by the company, or governance and accounting risks that may alter the investment thesis?"

Connetic Ventures

Connetic Adventures is a venture capital firm that invests in early-stage companies. The company uses data to develop its investment thesis, which is made up of three pillars. According to its blog, there were three pillars or principles that contributed to Connetic's venture capital investment strategy. These included diversification, value, and follow-on—each of which comes with a pro and con.

Why Is an Investment Thesis Important?

An investment thesis is a written proposal or research-based analysis of why investors or companies should pursue an investment. In some cases, it may also serve as a historical guide as to whether the investment was a good move or not. Whatever the reason, an investment thesis allows investors to make better, more informed decisions about whether to put their money into a specific investment. This written document provides insight into what the investment is, the goals of the investment, any associated costs, the potential for returns, as well as any possible risks and losses that may result.

Who Should Have an Investment Thesis?

An investment thesis is important for anyone who wants to invest their money. Individual investors can use a thesis to decide whether to purchase stock in a particular company and what strategy they should use, whether it's a buy-and-hold strategy or one where they only have the stock for a short period of time. A company can craft its own investment thesis to help weigh out whether an acquisition or growth strategy is worthwhile.

How Do You Create an Investment Thesis?

It's important to put your investment thesis in writing. Seeing your proposal in print can help you make a better decision. When you're writing your investment thesis, be sure to be clear and concise. Make sure you do your research and include any facts and figures that can help you make your decision. Be sure to include your goals, the potential for upside, and any risks that you may come across. Try to ask and answer some key questions, including whether the investment meets your investment goals and what could go wrong if you go ahead with the deal.

It's always important to have a plan, especially when it comes to investing. After all, you are putting your money at risk. Having an investment thesis can help you make more informed decisions about whether a potential investment is worth your while. Make sure you put your thesis in writing and answer some key questions about your goals, costs, and potential outcomes. Having a concrete proposal in place can spell the difference between earning returns and losing all your money. And that's if your thesis supports the investment in the first place.

Harvard Business School. " Writing a Credible Investment Thesis ."

Lanturn. " What is an Investment Thesis and 3 Tips to Make One ."

Morgan Stanley. " Global Opportunity ."

Medium. " The Data That Built Our Fund's Investment Thesis ."

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How to Develop Your Own Investment Thesis: A Critical Step for Aspiring Venture Capitalists

s an aspiring venture capitalist, you hold the key to unlock the untapped potential of startups, propelling them to soaring heights and reshaping industries. But in this electrifying landscape of opportunities, how do you navigate through the ever-changing tides? The answer lies in the essence of venture capital success: developing your own investment thesis.

What exactly is an Investment Thesis?

An investment thesis is your North Star, an illuminating beacon that guides you through the vast ocean of startups, helping you navigate toward the brightest prospects. It's a strategic framework, meticulously crafted to align your investment approach, criteria, and aspirations.

With an investment thesis, you define the types of companies you want to invest in, the industries you're interested in, and the stages of startups you believe have the most potential. It's like setting your preferences and priorities before you begin the journey.

Why is an investment thesis so critical for aspiring venture capitalists? The answer is simple—this well-defined roadmap sets you apart from the crowd and gives you the edge to thrive in this fiercely competitive world. It empowers you to make informed decisions, uncover hidden gems in the startup ecosystem, and unlock the true potential of visionary entrepreneurs.

In this blog post, we will explore the essential steps to create a compelling and potent investment thesis

Getting Started With Your Investment Thesis: Conducting Market Research

At the core of any successful investment thesis lies comprehensive market research. Understanding industry trends, evaluating market opportunities, and assessing the competitive landscape are vital steps to identify lucrative investment prospects. 

Keep a finger on the pulse of the business landscape and stay attuned to shifts and disruptions. Analyze the forces shaping various sectors, from cutting-edge technologies and regulatory changes to changes in consumer behavior. Identifying and understanding these trends will enable you to anticipate the future landscape, positioning you as an astute investor who can spot opportunities before they materialize.

With a keen understanding of industry trends, venture capitalists must evaluate market opportunities with a discerning eye. Look beyond the surface and assess the long-term growth potential of markets and industries. Identify white spaces and areas where innovation is likely to flourish. Be mindful of macroeconomic factors, such as GDP growth, inflation rates, and demographic shifts, as they can profoundly influence market dynamics. A comprehensive evaluation of market opportunities will empower you to focus your investments on ventures that have the potential to become tomorrow's industry leaders.

In the vibrant world of startups, competition is the norm. As such, to excel as a venture capitalist, you must also gain a panoramic view of the competitive landscape. Analyze existing players and their strengths, weaknesses, opportunities, and threats (SWOT analysis). Identify startups that have the potential to disrupt established markets and challenge the status quo. Furthermore, seek out market gaps, where unmet needs and underserved customer segments await innovative solutions. Investing in startups that address these gaps can lead to remarkable returns on investment and foster a positive impact on society.

Market research is not a mere exercise of intuition and speculation; it thrives on data-driven insights. Leverage data analytics, market reports, and industry research to augment your understanding of market trends. Embrace technology and data tools that can provide you with a wealth of information at your fingertips. By making data-driven decisions, you'll foster a more robust investment thesis and bolster your credibility as a venture capitalist.

While conducting market research, it's crucial to remember that the startup ecosystem is dynamic and ever-changing. Be prepared to pivot and adapt your investment thesis in response to new information and shifts in the market. Stay agile and flexible, allowing your investment strategy to evolve as you gain deeper insights. Successful venture capitalists are those who can navigate uncertainty, staying attuned to emerging trends and swiftly adjusting their course to capitalize on unforeseen opportunities.

Defining The Investment Criteria for your Investment Thesis

Once you've gathered market insights, now it’s the fun part - it's time to define your investment criteria. Determine the stages of startups you want to invest in, such as seed, early-stage, or late-stage companies. Consider the industries you're passionate about or have domain expertise in. 

Additionally, establish your preferred investment size and the level of diversification you aim to achieve within your portfolio. Having clear investment criteria will streamline your decision-making process and keep your investments focused on your goals.

Determining the Stages of Startups

Venture capitalists invest in startups at various stages of their lifecycle, each offering distinct opportunities and risks. Deciding which stage aligns best with your expertise and risk appetite is pivotal. Consider if you want to invest in seed-stage companies, which are in their infancy and require significant support, or if you prefer early-stage startups with a product and initial traction. Alternatively, you may focus on later-stage companies that are scaling and need capital to expand rapidly. Your chosen stage will dictate your involvement level and the potential return horizon of your investments.

Geographical Preferences and Target Industries

Venture capital is a global endeavor, and you can choose to invest locally, regionally, or even globally. Geographical preferences may be influenced by factors like your network, knowledge of specific markets, and comfort with regulatory environments. Moreover, identifying the industries you're passionate about or have domain expertise in is crucial. Investing in industries you understand well will allow you to provide strategic value to the startups you support, beyond just financial backing.

Investment Size and Portfolio Diversification

The size of your investments and portfolio diversification strategy are interlinked. Determine the average investment size you are comfortable with, as this will influence the types of startups you can back. Some venture capitalists prefer larger, concentrated bets on a select few startups, while others spread their investments across a broader range of smaller companies to diversify risk. Striking the right balance is key—too few investments can expose you to concentrated risk, while too many might dilute your ability to provide adequate support to each startup.

Alignment with Personal Values and Objectives

As an aspiring venture capitalist, your investment criteria should be in harmony with your personal values and long-term objectives. Consider what impact you want to make through your investments. Are you driven by social impact, environmental sustainability, or a particular mission? Aligning your investment criteria with your values will not only enhance your satisfaction as an investor but may also attract entrepreneurs who share your passion, fostering a mutually rewarding relationship.

Market Fit and Growth Potential

While defining your investment criteria, focus on identifying startups that exhibit strong market fit and immense growth potential. Market fit refers to the startup's ability to address a specific problem or need in the market effectively. Investigate whether the startup's product or service resonates with its target audience and has the potential for widespread adoption. Moreover, evaluate the scalability of the business model, as this will determine the startup's growth trajectory and its potential to become a market leader.

Synergy with Your Expertise and Network

Leverage your expertise and network to your advantage when defining your investment criteria. Aligning with startups that can benefit from your insights and connections will create a symbiotic relationship. As an investor, you can offer more than just financial support; your guidance and connections can be invaluable in helping startups navigate challenges and scale their businesses. Synergy with your expertise and network can significantly enhance your value proposition as a venture capitalist.

Balancing Risk and Return

Investing in startups inherently involves risk, and your investment criteria should reflect your risk appetite and tolerance. Strive for a balance between risk and potential return that aligns with your investment objectives. High-growth startups often carry higher risk, but they can also offer substantial rewards.

On the other hand, more established companies may provide a steadier return, albeit with potentially lower growth potential. Understanding this balance is essential in defining your investment criteria and building a well-rounded portfolio.

Balancing risk and potential returns is a fine art, and your investment thesis should outline how you plan to approach this delicate balance. Furthermore, learn to measure and quantify risk in the startup ecosystem using various risk assessment techniques to make informed investment choices.

Identifying Key Performance Indicators (KPIs) for Your Investment Thesis

Key Performance Indicators are quantifiable metrics that provide critical insights into the performance and achievements of a business. By tracking relevant KPIs, venture capitalists can assess the overall health and direction of a startup, enabling them to support portfolio companies effectively. Moreover, KPIs offer a basis for comparison, allowing you to benchmark a startup's progress against its peers and industry standards.

Tailoring KPIs to Startup Stages and Industries

While KPIs share a common goal of tracking performance, their significance can vary significantly based on the stage and industry of a startup. For example, early-stage companies might prioritize metrics related to customer acquisition, retention, and product-market fit. In contrast, late-stage startups might focus on revenue growth, customer lifetime value, and profitability. Tailoring KPIs to suit the unique needs and challenges of each startup stage and industry is vital for meaningful performance assessment.

Selecting Actionable and Measurable Metrics

When identifying KPIs, seek metrics that are both actionable and measurable. Actionable KPIs provide clear guidance on how to improve performance, helping startups identify areas that need attention and enhancement. Measurable KPIs, on the other hand, are quantifiable, allowing you to track progress and changes over time. The ability to take action based on KPIs and measure their impact ensures a proactive approach to enhancing a startup's performance.

Common KPIs in Venture Capital

While KPIs can be highly specific to individual startups and industries, certain metrics have proven valuable across the venture capital landscape. Some common KPIs include:

Customer Acquisition Cost (CAC): The cost to acquire a new customer, helping evaluate marketing efficiency.

Monthly Recurring Revenue (MRR): Provides insight into the company's predictable revenue stream.

Customer Churn Rate: Measures customer retention and the ability to maintain long-term 


Burn Rate: Tracks how quickly a startup is spending its capital, indicating runway and sustainability.

Gross and Net Profit Margins: Assessing revenue generation and cost efficiency.

Customer Lifetime Value (CLV): Estimates the value of a customer over their entire engagement with the startup.

The Power of Data-Driven Decision Making

KPIs are not merely numbers on a dashboard; they fuel data-driven decision-making. By continuously monitoring KPIs, you can identify strengths, weaknesses, and potential roadblocks. Data-driven insights enable you to provide tailored guidance and support to your portfolio companies, helping them navigate challenges and seize growth opportunities.

Building a Well-defined Due Diligence Process

A well-structured due diligence process empowers you to make informed decisions, mitigates risks, and will help you identify the startups that align best with your investment thesis!

Let's delve deeper into the key steps involved in building an effective due diligence process so you can include it on your Investment Thesis:

1. Defining Your Due Diligence Objectives

Start by clarifying your objectives for the due diligence process. What key aspects do you want to evaluate in potential startups? Identify the critical areas of focus, such as market opportunity, team capabilities, competitive landscape, financials, and scalability. Setting clear objectives ensures that you leave no stone unturned while assessing potential investments.

2. Gathering Essential Information

Begin the process by collecting comprehensive data and information about the startup under consideration. Request financial statements, market research, business plans, and any other relevant documentation. Engage in one-on-one discussions with the startup's founders and management team to gain insights into their vision, strategy, and execution plans. Gathering essential information lays the groundwork for a detailed evaluation.

3. Market Analysis

Conduct a thorough market analysis to assess the startup's positioning within its industry. Analyze market trends, potential for growth, competitive landscape, and potential threats. Understanding the market dynamics helps you gauge the startup's competitive advantage and potential for success.

4. Team Evaluation

Evaluate the startup's team to understand their expertise, experience, and alignment with the company's vision. Assess the cohesiveness and complementarity of the team, as a strong and capable team is a significant factor in a startup's success.

5. Financial Due Diligence

Perform rigorous financial due diligence to examine the startup's financial health and viability. Analyze revenue streams, cost structures, cash flow, and projections. Scrutinize financial ratios and indicators to assess the startup's financial sustainability and growth potential.

6. Product and Technology Assessment

Evaluate the startup's product or technology to gauge its uniqueness and potential market fit. Understand the value proposition it offers to customers and how it addresses market needs. Assess the scalability and defensibility of the product or technology to ensure long-term competitiveness.

7. Legal and Regulatory Review

Conduct a legal and regulatory review to identify any potential legal risks or compliance issues. Scrutinize contracts, licenses, intellectual property rights, and any pending legal disputes. Ensuring the startup operates within legal bounds safeguards your investment from unnecessary risks.

8. Customer and Partner Feedback

Gather feedback from customers, partners, and industry experts to gain external perspectives on the startup's product or service. Their insights can validate the startup's market fit, customer satisfaction, and potential for growth.

9. Risk Analysis

Identify and assess potential risks associated with the investment. Consider market risks, operational risks, technological risks, and competitive risks. A thorough risk analysis helps you make informed decisions about risk-reward trade-offs.

10. Decision-Making and Post-Investment Monitoring

Based on the findings from the due diligence process, make data-driven decisions on whether to invest in the startup. If you decide to proceed, establish a monitoring plan to track the startup's progress and performance after the investment. Continuously monitor the startup's performance against the initially defined objectives and pivot if needed.

Refining Your Thesis and Iterating

It’s also important to keep in mind that an investment thesis should not be static; it should evolve with your experiences and the changing market dynamics. Embrace flexibility and adaptability, and be open to learning from both successful and unsuccessful investments. As you gain insights from your portfolio companies and the market, update and refine your investment thesis to enhance its effectiveness continually!

Developing your own investment thesis is a critical step for aspiring venture capitalists. It provides you with a structured approach to identify and seize opportunities in the dynamic startup ecosystem. 

Through comprehensive market research, clear investment criteria, risk assessment, and an adaptable approach, your investment thesis will act as a guiding force throughout your venture capital journey. Embrace the continuous learning process, and don't hesitate to iterate and refine your thesis as you gain experience in the thrilling world of venture capital.

Interested in the full research paper?

You might also like, crisis resilience in vc: how the industry responds to economic challenges, mastering salary negotiations: insider tips for analyst and associate vc positions, vc titans of the past: lessons from legendary investors who shaped the industry, the power of standardization in venture capital: streamlining back-office operations, the evolution of learning: edtech's answer to an obsolete education model, ai in 2024: a year of innovation and investment - unveiling the funding landscape, about goingvc.

GoingVC is built around the idea of making venture capital education, investing, networks, and talent more accessible to those with the desire to succeed.

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The Impact Investor | ESG Investing Blog

The Impact Investor | ESG Investing Blog

Investing for financial return is only part of the equation.

How to Create an Investment Thesis [Step-By-Step Guide]

Updated on June 13, 2023

Our posts may contain links from our affiliate partners. This supports helps support the site as we donate 10% of all profits to sustainability organizations that align with our values. However, this does not influence our opinions or ratings. Please read our Terms and Conditions for more information.

One of the worst mistakes an investor can make is to sink their money into an investment without knowing why. While this may seem like the world’s most obvious mistake to avoid, it happens every day. Look no further than the stock market for plenty of examples of misguided optimism gone terribly wrong.

That’s where the idea of an investment thesis comes in. An investment thesis is a common tool used by venture capital investors and hedge funds as part of their investment strategy.

Most funds also use it on a regular basis to size up potential candidates during buy-side job interviews. But you don’t have to work at a venture capital fund or private equity firm to reap the benefits of creating an investment thesis of your own.

Table of Contents

What Is an Investment Thesis?

Materials needed to create a thesis for your investment strategy, a step-by-step guide to creating a solid investment thesis, step 1: start with the essentials, step 2: analyze the current market, step 3: analyze the company’s sector, step 4: analyze the company’s position within its sector, step 5: identify the catalyst, step 6: solidify your thesis with analysis, free tools to help strengthen your investment strategy.

Couple Checking an Online Documents

An investment thesis is simply an argument for why you should make a specific investment. Whether it be a stock market investment or private equity, investment theses are all about creating a solid argument for why a certain acquisition is a good idea based on strategic planning and research.

While it takes a little more work upfront, a clear investment thesis can be a valuable tool for any investor. Not only does it ensure that you fully understand why you’re choosing to put your hard-earned money into certain stocks or other assets, but it can also help you develop a long-term plan.

Should an investment idea not go as planned, you can always go back to your investment thesis to see if it still holds the potential to work out. By considering all the information your thesis contains, you’ll have a much better idea of whether it’s best to cut your losses and sell, continue holding, or even add to your position.

An investment thesis includes everything you need to create a solid game plan, making it a foundational part of any stock pitch.

See Related : Best Socially Responsible Stocks To Invest In Today

Writing on a Notebook

One of the benefits of an investment thesis is that it can be as complex or as simple as you like. If you actually work at a venture capital firm , then you may want to develop a full-on venture capital investment thesis. But if you’re a retail investor just looking to solidify your investment strategy, then your thesis may be much more straightforward.

If you’re an individual investor, then all you really need to create an investment thesis is somewhere to write it out. Whether it be in a Google or Word doc or on a piece of paper, just make sure you have a place to record your thesis so that you can consult it down the line.

If you’re developing a venture capital investment thesis that you plan to present to an investment committee or potential employers, then there are plenty of great tools online that can help. Slideteam has thousands of templates that can help you create a killer investment thesis , as well as full-on stock pitch templates.

As mentioned earlier, an investment thesis holds the potential to help you plot out a strategy for pretty much any acquisition. But for the sake of simplicity, we’ll assume throughout the examples in the following steps that you’re an investor interested in going long on a stock that you plan to hold for at least a few months or years.

Venture capitalists looking to invest in companies or startups can also apply the same principles to other investment goals. Investors who are looking to short a certain stock should also be able to use these techniques to locate potential investments. The main difference, of course, is that you’ll be looking for bad news instead of good.

First things first. Before you get into doing the research that goes into an investment thesis or stock pitch, make sure you take the time to write out the basics. At the top of the page, include things like:

  • The name of the company and its ticker symbol
  • Today’s date
  • How many shares of the company you already own, if any
  • The current cost average for any shares you may already hold
  • Whether the stock pays dividends and, if so, how often. You may also want to include the current ex-dividend and dividend payment dates.
  • A brief summary of the company and what it does

See Related : How to Start Investing With Purpose

Now it’s time to take a look at the entire market and the direction it’s headed. Why? As Investors Business Daily points out,

“History shows 3 out of 4 stocks move in the same direction as the overall market, either up or down. So if you buy stocks when the market is trending higher, you have a 75% chance of being right. But if you buy when the market is trending lower, you have a 75% chance of being wrong.”

While the overall market direction is definitely an important factor to keep in mind, what you choose to do with this information will largely come down to your individual investing style. Investors Business Daily founder William O’Neil advised investors only to jump into the market when it was trending up.

Another approach, however, is known as contrarian investing, which revolves around going against market trends. Warren Buffett summed up the idea behind this strategy with his famous quote, “Be fearful when others are greedy, and greedy when others are fearful.” Or as Baron Rothschild more graphically put it, “Buy when there is blood in the streets, even if the blood is your own.”

Most investors who are looking for a faster return will likely be better off waiting to strike until the iron is hot. If you align more with the long-term contrarian philosophy, however, bleak macroeconomic outlooks may actually strike you as an ideal investment opportunity .

See Related: How to Invest in Private Equity: A Step-by-Step

Now that you’ve got a look at the overall market, it’s time to take a look at the sector your company fits into. The Global Industry Classification Standard (GICS) breaks down the entire market into 11 sectors. If you want to get even more specific, you can further break down companies into the GICS’s 24 industry groups, 69 industries, and 158 sub-industries.

Once you identify which group your company belongs to, you’ll then want to take a look at that sector’s performance. Fidelity provides a handy breakdown of the performance of various sectors over different time periods.

But why does it matter? Two reasons.

  • Identifying which sectors various companies belong to can help you ensure that your portfolio is properly diversified
  • The reason that sector ETFs tend to be so popular is that when a sector is trending, many of the stocks within that sector tend to move in unison. The reverse is also true. When a certain industry is lagging, the individual stock prices of the companies in that industry may be affected negatively. While this is not always the case, it’s a general rule of thumb to keep in mind.

The idea behind working sectors into your investment criteria is to give you an overview of what type of investment you’re about to make. If you’re a momentum trader, then you may want to shoot for companies within the strongest-performing sectors this year or even over the past few months.

If you’re a value investor, however, you may be more open to sectors that have historically experienced high growth, even if they are currently suffering due to the overall state of the economy. Some speculative investors may even be interested in an innovative industry with strong potential growth possibilities, even if its time has not yet come.

See Related : How to Invest in Community [Step-by-Step Guide]

If you want to up your odds of success even more, then you’ll want to compare the company you’re interested in against the performance of similar companies in the same industry.

These are the companies that tend to get the most attention from large, institutional investors who are in a position to significantly increase their market value. Institutional investors tend to have a huge amount of money in play and are far less likely to invest in a company without a proven track record.

When choosing an investment, they’ll almost always go with a global leader over a new business, regardless of its promise. However, they also consider intrinsic value, which considers how much a company’s stock is selling for now, as opposed to how much revenue the company stands to earn in the future. In other words, institutional investors are looking for companies that are stable enough to avoid surprises but that also stand to generate considerable capital in the future.

Why work this into your game plan? Because even if you don’t have millions of dollars to invest in a company, there may be hedge funds or venture capital firms out there that do. When these guys make an investment, it tends to be a big one that can actually move a company’s share price upward. Why not ride their coattails and enjoy a solid growth rate as they invest more money over time into proven winners?

That’s why it’s important to make sure that you see how a company stacks up against its closest competitors. If it’s an industry-leading business with a large market share, it’s likely to be a strong contender with solid fundamentals. If not, you may end up discovering competing companies that make sense to consider instead.

See Related : What is a Triple Bottom Line? Definition & Examples

At this point, hopefully, you’ve identified the best stock in the best sector based on your ideal investing style. Now it’s time to find out exactly why it deserves to become a part of your portfolio and for how long.

If a company has been experiencing impressive growth, then there’s bound to be a reason why.

  • Is the company experiencing a major influx of business because it’s currently a leader in the hottest sector of the moment? Or is it a “good house in a bad neighborhood” that’s moving independently of the other stocks in its industry?
  • How long has it been demonstrating growth?
  • What appears to be the catalyst behind its movement? Does the stock owe its growth to strong management, recent world events, the approval of a new drug, the introduction of a hot new product, etc?

One mistake that far too many beginning investors make is assuming that short-term growth alone always indicates the potential for long-term profit. Unfortunately, this is not always the case. By figuring out exactly why a stock is moving, you’ll be far better positioned to decide how long to hold it before you sell.

A strong catalyst can cause the price of a stock to skyrocket overnight, even if it’s laid dormant for years. Even things like social media hype and rumors can cause a stock’s price to shoot up over the course of a given day. But woe to the investor that assumes these profits will last. Many are often left holding the bag when the price increase turns out to be part of a “ pump and dump .”

While many day traders can make a nice profit by capitalizing on these situations, such trades are best avoided altogether if you plan to hold a stock long-term. That’s why it’s so important to understand whether a stock is “in play” for the day or whether its growth can be attributed to more permanent factors that support the potential for a high return over time.

See Related : How to Become an Impact Investor [Step-By-Step Guide]

If you’re planning on investing a significant amount of capital in any stock, then a little research may be able to save you from a lot of heartache. Keep in mind that the focus of an investment thesis is to formulate a reasoned argument about why adding an asset to your portfolio is a good idea.

While all investments come with some level of risk, research can be an excellent risk mitigation strategy. There’s nothing worse than watching an investment fail due to an obvious factor you could have spotted with closer analysis. Don’t let it happen to you!

Fundamental analysis can help you ensure that your potential investments have the underlying traits that winning stocks are made of. While there’s a bit of a learning curve involved when you’re first starting out, here are some of the things you’ll want to focus on:

EPS stands for “earnings per share.” It’s a common financial indicator that basically tells you how much a company makes each time it sells a share of its stock. In this regard, a higher EPS is a good thing, but it’s important to look for solid EPS growth over time. Ideally, you’ll want to see consistent growth in a company’s EPS over the past three or more quarters.

Sales and Margins

Investing is all about putting your cash into successful companies, which is why sales and margins are key components to finding worthy investments. Sales indicate how much a business has made from (you guessed it) sales. Sales margin, also known as gross profit margin, is the amount of revenue a company actually gets to keep after you factor in overhead and other production costs. Ideally, a good investment will exhibit strong, consistent sales growth in recent years.

Return On Equity (ROE)

ROE is one of the more commonly used valuation metrics and is calculated by dividing the company’s net income/shareholders’ equity. ROE is basically a measure of how efficiently a company is using the capital it generates from equity fundraising to increase its own value. The higher the ROE, the more likely it is that a company operates with a focus on using its cash flow to increase its profits.

See Related : How to Do a Stakeholder Impact Analysis?

Woman Taking Notes

While these are just a few examples of various analysis methods to work into your investment thesis, they can go a long way toward locating solid companies worth investing in. Interested in learning more about technical and fundamental analysis? There are now plenty of great sites that can help you master the secrets of the training world.

In our opinion, Tradimo is one of the most underrated, as it provides tons of free classes for investors of all levels. Udemy also has some great classes that can help you learn how to beef up your investment thesis with as much quality information as possible.

But keep in mind that these are only suggestions. The most important part of any personal investment thesis is that it makes sense to you and can serve as a valuable tool to help you along your investing journey.

Related Resources

  • Best Impact Investing Online Courses
  • Best Green Apps for a More Sustainable Life
  • Sustainable Investing vs Impact Investing: What’s the Difference?

Avatar of The Impact Investor

Kyle Kroeger, esteemed Purdue University alum and accomplished finance professional, brings a decade of invaluable experience from diverse finance roles in both small and large firms. An astute investor himself, Kyle adeptly navigates the spheres of corporate and client-side finance, always guiding with a principal investor’s sharp acumen.

Hailing from a lineage of industrious Midwestern entrepreneurs and creatives, his business instincts are deeply ingrained. This background fuels his entrepreneurial spirit and underpins his commitment to responsible investment. As the Founder and Owner of The Impact Investor, Kyle fervently advocates for increased awareness of ethically invested funds, empowering individuals to make judicious investment decisions.

Striving to marry financial prudence with positive societal impact, Kyle imparts practical strategies for saving and investing, underlined by a robust ethos of conscientious capitalism. His ambition transcends personal gain, aiming instead to spark transformative global change through the power of responsible investment.

When not immersed in the world of finance, he’s continually captivated by the cultural richness of new cities, relishing the opportunity to learn from diverse societies. This passion for travel is eloquently documented on his site,, where you can delve into his unique experiences via his author profile.

Writing a Credible Investment Thesis

by David Harding and Sam Rovit

Every deal your company proposes to do—big or small, strategic or tactical—should start with a clear statement how that particular deal would create value for your company. We call this the investment thesis . The investment thesis is no more or less than a definitive statement, based on a clear understanding of how money is made in your business, that outlines how adding this particular business to your portfolio will make your company more valuable. Many of the best acquirers write out their investment theses in black and white. Joe Trustey, managing partner of private equity and venture capital firm Summit Partners, describes the tool in one short sentence: "It tells me why I would want to own this business." 10

Perhaps you're rolling your eyes and saying to yourself, "Well, of course our company uses an investment thesis!" But unless you're in the private equity business—which in our experience is more disciplined in crafting investment theses than are corporate buyers—the odds aren't with you. For example, our survey of 250 senior executives across all industries revealed that only 29 percent of acquiring executives started out with an investment thesis (defined in that survey as a "sound reason for buying a company") that stood the test of time. More than 40 percent had no investment thesis whatsoever (!). Of those who did, fully half discovered within three years of closing the deal that their thesis was wrong.

Studies conducted by other firms support the conclusion that most companies are terrifyingly unclear about why they spend their shareholders' capital on acquisitions. A 2002 Accenture study, for example, found that 83 percent of executives surveyed admitted they were unable to distinguish between the value levers of M&A deals. 11 In Booz Allen Hamilton's 1999 review of thirty-four frequent acquirers, which focused chiefly on integration, unsuccessful acquirers admitted that they fished in uncharted waters. 12 They ranked "learning about new (and potentially related) business areas" as a top reason for making an acquisition. (Surely companies should know whether a business area is related to their core before they decide to buy into it!) Successful acquirers, by contrast, were more likely to cite "leading or responding to industry restructuring" as a reason for making an acquisition, suggesting that these companies had at least thought through the strategic implications of their moves.

Not that tipping one's hat to strategy is a cure-all. In our work with companies that are thinking about doing a deal, we often hear that the acquisition is intended for "strategic" reasons. That's simply not good enough. A credible investment thesis should describe a concrete benefit, rather than a vaguely stated strategic value.

This point needs underscoring. Justifying a deal as being "strategic" ex post facto is, in most cases, an invitation to inferior returns. Given how frequently we have heard weak "strategic" justifications after a deal has closed, it's worth passing along a warning from Craig Tall, vice chair of corporate development and strategic planning at Washington Mutual. In recent years, Tall's bank has made acquisitions a key part of a stunningly successful growth record. "When I see an expensive deal," Tall told us, "and they say it was a 'strategic' deal, it's a code for me that somebody paid too much." 13

And although sometimes the best offense is a good defense, this axiom does not really stand in for a valid investment thesis. On more than a few occasions, we have been witness to deals that were initiated because an investment banker uttered the Eight Magic Words: If you don't buy it, your competitors will.

Well, so be it. If a potential acquisition is not compelling to you on its own merits, let it go. Let your competitors put their good money down, and prove that their investment theses are strong.

Let's look at a case in point: [Clear Channel Communications' leaders Lowry, Mark, and Randall] Mayses' decision to move from radios into outdoor advertising (billboards, to most of us). Based on our conversations with Randall Mays, we summarize their investment thesis for buying into the billboard business as follows:

Clear Channel's expansion into outdoor advertising leverages the company's core competencies in two ways: First, the local market sales force that is already in place to sell radio ads can now sell outdoor ads to many of the same buyers, and Clear Channel is uniquely positioned to sell both local and national advertisements. Second, similar to the radio industry twenty years ago, the outdoor advertising industry is fragmented and undercapitalized. Clear Channel has the capital needed to "roll up" a significant fraction of this industry, as well as the cash flow and management systems needed to reduce operating expenses across a consolidated business.

Note that in Clear Channel's investment thesis (at least as we've stated it), the benefits would be derived from three sources:

  • Leveraging an existing sales force more extensively
  • Using the balance sheet to roll up and fund an undercapitalized business
  • Applying operating skills learned in the radio trade

Note also the emphasis on tangible and quantifiable results, which can be easily communicated and tested. All stakeholders, including investors, employees, debtors, and vendors, should understand why a deal will make their company stronger. Does the investment thesis make sense only to those who know the company best? If so, that's probably a bad sign. Is senior management arguing that a deal's inherent genius is too complex to be understood by all stakeholders, or simply asserting that the deal is "strategic"? These, too, are probably bad signs.

Most of the best acquirers we've studied try to get the thesis down on paper as soon as possible. Getting it down in black and white—wrapping specific words around the ideas—allows them to circulate the thesis internally and to generate reactions early and often.

The perils of the "transformational" deal . Some readers may be wondering whether there isn't a less tangible, but equally credible, rationale for an investment thesis: the transformational deal. Such transactions, which became popular in the exuberant '90s, aim to turn companies (and sometimes even whole industries) on their head and "transform" them. In effect, they change a company's basis of competition through a dramatic redeployment of assets.

The roster of companies that have favored transformational deals includes Vivendi Universal, AOL Time Warner (which changed its name back to Time Warner in October 2003), Enron, Williams, and others. Perhaps that list alone is enough to turn our readers off the concept of the transformational deal. (We admit it: We keep wanting to put that word transformational in quotes.) But let's dig a little deeper.

Sometimes what looks like a successful transformational deal is really a case of mistaken identity. In search of effective transformations, people sometimes cite the examples of DuPont—which after World War I used M&A to transform itself from a maker of explosives into a broad-based leader in the chemicals industry—and General Motors, which, through the consolidation of several car companies, transformed the auto industry. But when you actually dissect the moves of such industry winners, you find that they worked their way down the same learning curve as the best-practice companies in our global study. GM never attempted the transformational deal; instead, it rolled up smaller car companies until it had the scale to take on a Ford—and win. DuPont was similarly patient; it broadened its product scope into a range of chemistry-based industries, acquisition by acquisition.

In a more recent example, Rexam PLC has transformed itself from a broad-based conglomerate into a global leader in packaging by actively managing its portfolio and growing its core business. Beginning in the late '90s, Rexam shed diverse businesses in cyclical industries and grew scale in cans. First it acquired Europe's largest beverage-can manufacturer, Sweden's PLM, in 1999. Then it bought U.S.–based packager American National Can in 2000, making itself the largest beverage-can maker in the world. In other words, Rexam acquired with a clear investment thesis in mind: to grow scale in can making or broaden geographic scope. The collective impact of these many small steps was transformation. 14

But what of the literal transformational deal? You saw the preceding list of companies. Our advice is unequivocal: Stay out of this high-stakes game. Recent efforts to transform companies via the megadeal have failed or faltered. The glamour is blinding, which only makes the route more treacherous and the destination less clear. If you go this route, you are very likely to destroy value for your shareholders.

By definition, the transformational deal can't have a clear investment thesis, and evidence from the movement of stock prices immediately following deal announcements suggests that the market prefers deals that have a clear investment thesis. In "Deals That Create Value," for example, McKinsey scrutinized stock price movements before and after 231 corporate transactions over a five-year period. 15 The study concluded that the market prefers "expansionist" deals, in which a company "seeks to boost its market share by consolidating, by moving into new geographic regions, or by adding new distribution channels for existing products and services."

On average, McKinsey reported, deals of the "expansionist" variety earned a stock market premium in the days following their announcement. By contrast, "transformative" deals—whereby companies threw themselves bodily into a new line of business—destroyed an average of 5.3 percent of market value immediately after the deal's announcement. Translating these findings into our own terminology:

  • Expansionist deals are more likely to have a clear investment thesis, while "transformative" deals often have no credible rationale.
  • The market is likely to reward the former and punish the latter.

The dilution/accretion debate . One more side discussion that comes to bear on the investment thesis: Deal making is often driven by what we'll call the dilution/accretion debate . We will argue that this debate must be taken into account as you develop your investment thesis, but your thesis making should not be driven by this debate.

Simply put, a deal is dilutive if it causes the acquiring company to have lower earnings per share (EPS) than it had before the transaction. As they teach in Finance 101, this happens when the asset return on the purchased business is less than the cost of the debt or equity (e.g., through the issuance of new shares) needed to pay for the deal. Dilution can also occur when an asset is sold, because the earnings power of the business being sold is greater than the return on the alternative use of the proceeds (e.g., paying down debt, redeeming shares, or buying something else). An accretive deal, of course, has the opposite outcomes.

But that's only the first of two shoes that may drop. The second shoe is, How will Wall Street respond? Will investors punish the company (or reward it) for its dilutive ways?

Aware of this two-shoes-dropping phenomenon, many CEOs and CFOs use the litmus test of earnings accretion/dilution as the first hurdle that should be put in front of every proposed deal. One of these skilled acquirers is Citigroup's [former] CFO Todd Thomson, who told us:

It's an incredibly powerful discipline to put in place a rule of thumb that deals have to be accretive within some [specific] period of time. At Citigroup, my rule of thumb is it has to be accretive within the first twelve months, in terms of EPS, and it has to reach our capital rate of return, which is over 20 percent return within three to four years. And it has to make sense both financially and strategically, which means it has to have at least as fast a growth rate as we expect from our businesses in general, which is 10 to 15 percent a year. Now, not all of our deals meet that hurdle. But if I set that up to begin with, then if [a deal is] not going to meet that hurdle, people know they better make a heck of a compelling argument about why it doesn't have to be accretive in year one, or why it may take year four or five or six to be able to hit that return level. 16

Unfortunately, dilution is a problem that has to be wrestled with on a regular basis. As Mike Bertasso, the head of H. J. Heinz's Asia-Pacific businesses, told us, "If a business is accretive, it is probably low-growth and cheap for a reason. If it is dilutive, it's probably high-growth and attractive, and we can't afford it." 17 Even if you can't afford them, steering clear of dilutive deals seems sensible enough, on the face of it. Why would a company's leaders ever knowingly take steps that would decrease their EPS?

The answer, of course, is to invest for the future. As part of the research leading up to this book, Bain looked at a hundred deals that involved EPS accretion and dilution. All the deals were large enough and public enough to have had an effect on the buyer's stock price. The result was surprising: First-year accretion and dilution did not matter to shareholders. In other words, there was no statistical correlation between future stock performance and whether the company did an accretive or dilutive deal. If anything, the dilutive deals slightly outperformed. Why? Because dilutive deals are almost always involved in buying higher-growth assets, and therefore by their nature pass Thomson's test of a "heck of a compelling argument."

Reprinted with permission of Harvard Business School Press. Mastering the Merger: Four Critical Decisions That Make or Break the Deal , by David Harding and Sam Rovit. Copyright 2004 Bain & Company; All Rights Reserved.

[ Buy this book ]

David Harding (HBS MBA '84) is a director in Bain & Company's Boston office and is an expert in corporate strategy and organizational effectiveness.

Sam Rovit (HBS MBA '89) is a director in the Chicago office and leader of Bain & Company's Global Mergers and Acquisitions Practice.

10. Joe Trustey, telephone interview by David Harding, Bain & Company. Boston: 13 May 2003. Subsequent comments by Trustey are also from this interview.

11. Accenture, "Accenture Survey Shows Executives Are Cautiously Optimistic Regarding Future Mergers and Acquisitions," Accenture Press Release, 30 May 2002.

12. John R. Harbison, Albert J. Viscio, and Amy T. Asin, "Making Acquisitions Work: Capturing Value After the Deal," Booz Allen & Hamilton Series of View-points on Alliances, 1999.

13. Craig Tall, telephone interview by Catherine Lemire, Bain & Company. Toronto: 1 October 2002.

14. Rolf Börjesson, interview by Tom Shannon, Bain & Company. London: 2001.

15. Hans Bieshaar, Jeremy Knight, and Alexander van Wassenaer, "Deals That Create Value," McKinsey Quarterly 1 (2001).

16. Todd Thomson, speaking on "Strategic M&A in an Opportunistic Environment." (Presentation at Bain & Company's Getting Back to Offense conference, New York City, 20 June 2002.)

17. Mike Bertasso, correspondence with David Harding, 15 December 2003.

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Why and How to Build Your Investment Thesis

investment thesis education

When starting out in venture capital, the diversity and breadth of opportunities can get a bit overwhelming. To cut through the chaos, it’s important to arm yourself with an investment thesis. But how do you develop one? Our resident Investor Relations expert, Josh Liggett, has created a checklist of six steps to getting started. An investment thesis applies to any form of investing, from the stock market to horse racing… as long as it involves putting your money behind a principled decision.

These decisions are not just for beginners; experts in the field like Warren Buffet, and Peter Thiel have spent years developing their own personal strategies. Buffet, for example, likes to hold stocks for a long time . Shark Tank's Kevin O’Leary wants his money to bring back prisoners of war. And Thiel thinks those two guys are wrong. One thing is certain – when wading into the venture capital market, without a well-thought-out strategy, an investor could end up with too much or too little money in specific sectors, stages, or asset classes, leading to an unbalanced portfolio. Here are six steps to developing your investment thesis for Venture Capital.

Think it Over and Get Creative!

Spend some time on a brainstorming session, and be sure to jot down some notes. A thesis can be as simple as “I think driverless cars are the future” or as complex as "AI is the future," and its predictive models will change the business-consumer relationship. Come up with a hypothesis that reflects your instincts, knowledge, and needs. Having trouble getting started? Start with your personal experiences. Do you know what it takes to take a company public? Do you have your finger on the pulse of a specific industry? Do you have insight into a sector that others would die for? Are you Mark Cuban? If yes, then you can use that information as investment criteria. You can also follow experts you respect - like only investing in companies that large VCs like Sequoia back, or follow famous investors like Thiel or Chris Sacca. Remember: A thesis is only limited to the creativity of the investor, so get as specific or vague as you want.

Dive Into Specifics

Once your thesis starts to take shape, go further. List the specifics of your strategy. How much do you want to invest? What sectors are you interested in? What regions do you want to invest in? Seed or Venture stage? First time founder or serial entrepreneur? What type of shares do you want? Do you have any deal breakers? You get the gist. The more specifics, the more honed your thesis will be.

Become an Expert: Read, Read, Read

Once you know what you are looking for, it’s time to learn. Education is rule number one when coming up with a strategy. It’s important to fully understand the ecosystem you’re interested in, from the perspectives of both the incumbent and startup side. Read respected publications ( The Wall Street Journal [WSJ], Financial Times, Bloomberg , etc) that cover incumbents. Each major publication has a technology section featuring innovation, as well as columnists covering specific areas. For example, Matt Levine from Bloomberg is a great read for insight into financial markets and fintech. For the startup perspective, the main information hub is TechCrunch, but there are other valuable resources out there. Great places to start include the blog of Silicon Valley legend Eric Reis, Startup Lesson Learned , and Mattermark Daily. There are publications and blogs dedicated to specific industries as well. For example, Coindesk and Ethereum’s blog are good sources on blockchain and cryptocurrencies, while MedGadget has the latest in medical technology.

If you’re more daring, check out social news and community platforms, like Reddit or Quora. On these platforms, you can post, view, and answer questions and read the community’s comments on nearly everything under the sun. See if anyone else supports your model, and why. It’s also important to understand the different terms in startup investing. From the Power Law to conquering the term sheet, it’s important you grasp the terms about which you are investing. During the education stage, don’t be afraid to tweak/change/burn your old thesis. This is the time to learn, and don’t be scared to change your previous beliefs. At the same time, don’t hesitate to channel your “inner Thiel” and go against the tide.

Bounce It Off your Colleagues and Peers

Get a group of friends together and practice selling your thesis to them. Bill Gates and Warren Buffett employ the same strategy., as the friends regularly bounce ideas off each other.

If you can’t convey to a friend why you think you’re right and defend your position, then you should probably go back to the drawing board.

Put it into Action: Invest

If you have gotten this far, congratulations! The hard part is over, now it’s time to put your money where your mouth is. Pick the companies and funds to invest in, keeping your hard-earned thesis front and center. Don’t be blinded by cool looking companies, follow your educated hypothesis.

Continue to Evaluate your Thesis

Finally, don’t be afraid to stick to your thesis if you’re doing badly or change it even if you’re doing great. It’s a dynamic thing, especially as you continue to educate yourself. Who knows, you could be too early to a new trend or catching the tail end of an old one.

Reid Hoffman put it best: “It’s useful to be able to recognize whether you’re on track or not. To have the belief, but also paranoia about am [sic] I tracking against my investment thesis.”Check out and start following your hypothesis today.

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  • Feb 27, 2023

How to Write the Perfect Investment Thesis

money tree

For investment managers, finding investment opportunities is only half the challenge. Often the harder part is raising funds. To do this they need to create the perfect investment thesis to set out a convincing argument as to why their investment strategy will generate a return on investment for their clients. In this article, we’ll explore the importance of crafting a perfect investment thesis and provide insights into how to write one.

What is an Investment Thesis?

An investment thesis outlines a fund manager’s investment strategy and rationale for investing in a particular market or niche. It’s a crucial document that investment managers use to provide investors with the information and data they need to decide whether or not to invest in a fund. It can be turned into a variety of marketing materials for the fund including white papers, one-pagers, and investment decks.

The investment thesis should be concise and articulate the investment logic and framework for why a particular market or niche presents an attractive investment. It should outline the investment strategy and how it aligns with the fund manager’s hypothesis. The thesis should also address potential risks and benefits to investors.

Successful investment theses typically include an analysis of market trends, an assessment of the competitive landscape, and an explanation of why the investment opportunity presents an attractive opportunity.

In 2013, Ron Baron, a fund manager, invested in Tesla. At the time the stock was trading at $25 per share. However, Baron believed that electric cars were the future , and he was convinced that Tesla would become the leader in the EV industry. Ten years later, Tesla’s stock is trading at over $200 per share, making it one of the most successful investments in recent years.

Empty Plan

Step-by-Step Guide to Writing the Perfect Investment Thesis

Crafting the perfect investment thesis is not an easy task. It requires a great deal of research, analysis, and writing skills. Follow our step-by-step guide to write a perfect investment thesis.

Step 1: Define Your Investment Strategy

Determine your investment goals and objectives.

To define your investment strategy, you need to first need to understand your investment goals and objectives. Are you looking to invest in high-growth companies or established companies that generate a stable return? What is your investment horizon? What is risk profile? How much capital do you need to raise?

Identify investment opportunities

Once you have defined your investment goals and objectives, you need to identify your target market and investment opportunities in that market.

Define your investment strategy

Having determined your goals, risk tolerance and capital requirements you need to create a high-level investment strategy. This is a set of principles that will help the fund achieve its investment goals and guide investment decisions. This can be refined as you conduct market research and receive feedback from investors and industry-peers.

Step 2: Conducting Market Research

An investment thesis that is not backed by data is just opinion. To write the perfect investment thesis you need to conduct market research. This includes analyzing market trends, identifying potential risks and benefits, and conducting competitive analysis.

How to analyze market trends using data

To analyze market trends, you need to collect and analyze data. Data can come from a variety of sources including industry reports, financial statements, and news articles to identify trends in the market. You can also use tools such as Google Trends to identify search trends for specific keywords. There are also opportunities to use official data to back up claims, for example census data to prove an investment thesis based on demographic trends.

A variety of alternative data sources are available. these include:

Web scraping : Scraping data from online sources including social media sites, e-commerce or news stories. This data can be analyzed using natural language processing techniques (categorization, sentiment analysis).

Open data : There is a growing trend of organizations making data freely available. Good examples include traffic patterns on metro networks such as TFL in London .

Sensors and satellites : A growing industry of data providers is providing access to alternative data sources. From satellite data showing agricultural production to IoT sensor devices.

Polls and Surveys : Surveys provide insights into the collective consciousness. From tangible economic behaviors such as buying and shopping habits, customers expectations, information on personal finances, to social and political views.

Identifying market opportunities and potential risks

Having analyzed market trends, you need to identify market opportunities and potential risks. Investors need to be aware of different types of investment risks, such as market risk, credit risk, and liquidity risk associated with your investment thesis. A thorough analysis of potential risks helps investors make informed decisions and ensure that the investment is aligned to their risk appetite. The analysis should cover both systematic and unsystematic risks, There are a variety of statistical methods than can be used to measure risk and volatility including standard deviation, Sharpe ratio, beta, value at risk (VaR), conditional value at risk (CVaR), and R-squared.

Conducting competitive analysis

You may also want to include a competitive analysis. This looks at the competition in your target market. Who are the main players in the industry, their strengths, weaknesses, and competitive advantage.

Step 3: Developing Your Investment Hypothesis

The best investment theses include a well structured investment hypothesis. An investment hypothesis summarises why an investment opportunity exists in a given market. It should be based on your research and analysis and articulated in a clear and concise manner.

What is an investment hypothesis?

An investment hypothesis is a proposed explanation for a specific investment opportunity. It’s a statement that describes the investment opportunity and how it aligns with the investment manager’s investment goals and objectives.

Formulating an investment hypothesis based on your research and analysis

To develop a strong investment hypothesis, you need to review the data and information collected during your market research. Using this you need to identify key trends, opportunities, and risks and determine an investment strategy that allows you to achieve investment goals and objectives. This is the time to revisit and critique your initial investment strategy.

H4: Articulating the investment thesis in a clear and concise manner

Once you have developed your investment hypothesis, you need to articulate it in a clear and concise manner. This includes a clear investment logic and analytical framework for why a particular market or niche presents an attractive investment. You should also outline the investment strategy and how it aligns with your hypothesis.

Step 4: Writing the Investment Thesis

Having created the perfect investment thesis you need to structure the thesis and include key elements to make it persuasive.

The structure and format of a successful investment thesis

A successful investment thesis typically follows a structure that includes an executive summary, market analysis, investment hypothesis, investment strategy, and potential risks and benefits. The thesis should also include data and visual aids, such as graphs and charts.

Key elements to include in your investment thesis

To make your investment thesis persuasive, you need to include key elements such as a clear articulation of the investment opportunity, a detailed explanation of the investment hypothesis, an overview of the investment strategy, and describe the risks and benefits for potential investors.

Writing with clarity and brevity

To make your investment thesis easy to read and understand, you need to write with clarity and brevity. Use simple language and avoid jargon. Keep the thesis concise and to the point.

What type of resources and marketing materials do you need to create

Having defined your investment thesis you know need to create a variety of marketing materials in order to present to potential investors. These will vary depending on the type of investors and the regulatory framework you operate under. Some common investor marketing materials include:

Investor decks

An investor deck is a summary of your investment thesis. It should include a summary of your investment hypothesis, market opportunity with data, investment strategy, expected outcomes, risks, and benefits to investors. The investor deck should be concise and easy to understand. Avoid lengthy text and present the opportunity using relevant data points. Employing a professional designer will maximize the impact of your investment thesis.

The structure of an investment deck forces you to focus only on the key points, consequently a clear analytical framework or investment logic is essential.

White papers

A white paper is a more detailed description of your investment thesis. It should include an in-depth analysis of the market trends, competitive landscape, and investment opportunity. The white paper should also include an overview of your investment strategy and potential risks and benefits.

Investment one-pager

An investment one-pager is a brief summary of your investment hypothesis, market opportunity, and risks and benefits. It should be a one-page document that investors can quickly review to understand your investment opportunity.

Step 5: Refining and Perfecting Your Investment Thesis

The final step in writing a perfect investment thesis is to refine and perfect it. You need to continuously refine and improve your thesis to ensure it’s persuasive and effective.

Revising and editing your investment thesis

Once you have written your investment thesis, you need to revise and edit it. Review the thesis for grammar, punctuation, and spelling errors. Ensure that the thesis is clear, concise, and persuasive. Nothing will damage your credibility more than easily fixed errors or incorrect data.

Seek feedback from peers and industry experts

You should seek feedback from peers and industry experts to ensure that your investment thesis is persuasive and effective. Aim to get feedback from colleagues, mentors, or industry experts all of whom can offer a unique outside perspective.

Continuously refining and improving your investment thesis

Investment managers should continuously refine and improve their investment thesis. They should review the thesis periodically and update it as needed to reflect changes in the market or investment strategy.

Crafting a perfect investment thesis is a crucial task for investment and fund managers. The investment thesis is a document that outlines the investment strategy and rationale for investing in a particular market or niche. A good investment thesis provides investors with a clear understanding of the investment opportunity, the risks and benefits, and the potential return on investment.

To write a perfect investment thesis, investment managers need to define their investment strategy, conduct market research, develop an investment hypothesis, craft the thesis, and refine and perfect it. They should also create marketing materials such as an investor deck, white paper, and investment one-pager to summarize their investment opportunity. Investment managers should continuously refine and improve their investment thesis to ensure it’s persuasive and effective.

How Interpretive Economics can help you write the perfect investment thesis

At Interpretive Economics, we help investment managers, asset managers, venture capital, family offices and other investment professionals create a variety of investment marketing materials including investment white papers, investor decks and investment one-pagers. We are experts at economic analysis, sourcing and analyzing data and crafting investment hypotheses. Get in touch to see how we can help you create the perfect investment thesis.

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investment thesis education

Investment Thesis: An Argument in Support of Investing Decisions

October 29, 2023 by Abi Tyas Tunggal

An investment thesis is a well-reasoned argument that supports a specific investment decision, playing a vital role in the strategic planning process for individual investors and businesses alike. It comprises detailed research and analysis to evaluate an investment's potential profitability. A good investment thesis serves multiple purposes, including helping in the decision-making process, providing a comprehensive framework for monitoring and assessment, and offering a structured approach to identifying potential opportunities.

There are different types of investment strategies, such as venture capital , private equity, and long-term value investments. The core of an investment thesis involves identifying key parameters for evaluating an investment, understanding the unique market dynamics and competitive landscape, and realizing how to create value through strategic planning. To ensure a comprehensive and detailed investment thesis, it is crucial to involve thorough research, considering emerging trends and opportunities, and incorporating industry case studies for better understanding. Ultimately, financial statements and valuation metrics play a significant role in determining a well-suited investment decision.

Key Takeaways

  • An investment thesis is a well-reasoned, research-based argument supporting a specific investment decision
  • There are several types of investment strategies, and a well-structured investment thesis addresses market dynamics and competition to create value
  • Research, valuation metrics, and understanding emerging trends are crucial in crafting a compelling investment ideas

Defining an Investment Thesis

An investment thesis is a well-structured, logical argument that justifies a particular investment decision, based on thorough research and analysis. It is essential for investors, as well as financial professionals in the domains of investment banking, private equity, hedge funds, and venture capital funds . A confident and knowledgeable investor will build out clear investment criteria to successfully navigate the investment landscape.

The primary purpose of an investment thesis is to outline the reasons and expected outcomes of a proposed investment, often focusing on the potential for growth and profit. This document offers a roadmap for investors, guiding them through their decision-making process, and helping to ensure that they arrive at rational and informed conclusions. A comprehensive investment thesis should consider various aspects, such as market conditions, competitive landscape, and financial performance of the targeted asset or company.

A strong investment thesis is built on rigorous market research and analysis. This involves evaluating historical and current financial information, as well as scrutinizing industry trends and the overall economic environment. Skilled investors will also incorporate their expertise in the industry to better assess the merits of an investment opportunity. This level of thoroughness creates a confidently expressed thesis, allowing investors to remain steadfast in their investment decisions, even amid market volatility.

In summary, an investment thesis plays a pivotal role in the investing process. It presents a well-reasoned argument, grounded in extensive research and clear analysis, that supports an investment decision. Crafting a robust investment thesis is crucial for both individual and institutional investors as it provides a solid foundation for investment choices and ensures the alignment of investment strategies with long-term objectives.

Importance of Research in Crafting an Investment Thesis

Thorough research is a crucial aspect of creating a solid investment thesis. It allows investors to gather vital information and insights that will help guide their investment decisions. There are several elements to consider while conducting this research, with data analysis, understanding risks, and returns being essential components.

Data Analysis

Data analysis forms the backbone of any research conducted for crafting an investment thesis. It involves collecting, organizing, and interpreting various types of data, such as financial statements, market trends, and industry forecasts, to identify patterns and make informed predictions about a potential investment opportunity. A comprehensive data analysis can help investors make confident choices based on reliable information, which is essential for a successful investment strategy.

Some key data analysis techniques used in crafting an investment thesis include:

  • Comparative analysis: Comparing the performance of different companies within the same industry to identify investment opportunities.
  • Trend analysis: Monitoring historical data to determine patterns and potential future developments.
  • Financial statement analysis: Examining the financial health of a company through its balance sheets, income statements, and cash flow statements.

Understanding Risks and Returns

One of the primary goals of research in developing an investment thesis is to assess the risk/reward profile of a potential investment. This involves evaluating the potential risks associated with the investment and weighing them against the expected returns. A sound investment thesis should demonstrate a clear understanding of these risks and offer a rationale for why the investment’s potential returns make it a worthwhile addition to a portfolio.

Some common risks to consider when crafting an investment thesis include:

  • Market risk: The risk of an investment losing value due to fluctuations in the market.
  • Credit risk: The risk that a company or issuer of a financial instrument may default on its obligations.
  • Operational risk: The risk of losses arising from failed internal processes, systems, or personnel within a business.

Evaluating these risks requires investors to develop a deep understanding of the investment opportunity, its industry, and the factors that may impact its performance. A diligent and systematic approach to research can help investors identify potential risks and gains, leading to informed and confident decision-making in crafting a strong investment thesis.

Types of Investment Strategy

When it comes to crafting an investment thesis, selecting an appropriate investment strategy is crucial. In this section, we will discuss two popular strategies: Value Investing and Growth Investing.

Value Investing

Value investing is a strategy that focuses on identifying undervalued stocks or assets in the market. These investments typically have lower valuations, which are reflected in their price-to-earnings ratios or book values. The central idea behind value investing is that the market may sometimes undervalue a company or asset, presenting an opportunity for investors willing to do thorough research and analysis.

The process of value investing involves:

  • Fundamental analysis : Evaluating a company's financial health, management, and competitive advantages
  • Value metrics : Identifying various valuation metrics, such as price-to-earnings, price-to-book, and dividend yield
  • Margin of safety : Discovering investment opportunities with a built-in cushion to reduce the risk of loss

Famous investors, such as Warren Buffett and Benjamin Graham, have implemented value investing strategies to achieve long-term success.

Growth Investing

On the other hand, growth investing centers on companies that are expected to grow at an above-average rate compared to their industry. Growth investors seek opportunities in businesses they believe will offer substantial capital appreciation through rapid expansion or market-share gains. They prioritize the potential for future profit over the stock's valuation.

Features of growth investing include:

  • High expectations : Companies targeted by growth investors typically have a history of robust revenue and profit growth
  • Momentum : Investors seek stocks with upward price momentum, as increasing demand for these stocks may drive prices even higher
  • Risk tolerance : Growth stocks can be volatile, and investors must be prepared to weather price swings

Renowned growth investors like Peter Lynch and Phil Fisher have demonstrated the effectiveness of growth investing throughout their careers.

Both value and growth investing strategies have their unique advantages and require different levels of risk tolerance. Investors should carefully consider their investment thesis and select a strategy that aligns with their objectives and risk appetite.

Venture Capital and Private Equity Investment Theses

When considering investments in private companies, venture capital (VC) and private equity (PE) firms each have their own unique strategies encapsulated within their respective investment theses. These theses provide guidance on the focus of investments, the sectors or geographies of interest, and the stage of the target companies.

Learn more about the differences between private equity and venture capital .

Venture Capital Investment Thesis

A venture capital investment thesis outlines how a VC fund aims to make money for its investors, typically referred to as Limited Partners (LPs). This strategy identifies crucial factors such as the stage of companies the fund will invest in, commonly early-stage companies, the targeted geography, and specific sectors of focus.

The thesis may vary depending on a venture capitalist's unique specialization, with some firms concentrating on a specific vertical and stage, while others invest more broadly without a core thesis driving their decisions. The underlying objective of a VC investment thesis is to outline how the firm will achieve high returns on investment by supporting and nurturing the growth of portfolio companies.

Private Equity Investment Thesis

In contrast, a private equity investment thesis is an evidence-based case in support of a particular investment opportunity. It usually begins with a concise argument illustrating how the potential deal supports the fund's general investment strategy. The thesis then provides details that substantiate this preliminary conclusion.

Private equity firms often target more established companies compared to venture capital firms, focusing on businesses with a proven track record. The PE investment thesis may identify areas where operational improvements, strategic mergers, or better capital structures could enhance value, ultimately generating a good return for the firm and its investors.

Overall, both venture capital and private equity investment theses serve as critical frameworks guiding investment decisions. They not only help align these decisions with a firm's specialized strategy but also provide a basis for evaluating potential deals to ensure they contribute to the firm's goals and long-term value creation.

Key Parameters for Evaluating an Investment

When assessing the viability of an investment, it is essential to examine various key parameters to make informed decisions. By analyzing these factors, investors can gain a deeper understanding of a company's financial health and its potential for growth.

One vital metric to consider is earnings per share (EPS) , which represents the portion of a company's profit attributed to each outstanding share of its common stock. A higher EPS indicates higher earnings and suggests that the company may be a lucrative investment opportunity.

Another fundamental metric is the return on assets (ROA) , which measures the effectiveness of a company in using its assets to generate profit. The higher the ROA, the better the company is at utilizing its assets to generate earnings. Similarly, return on equity (ROE) is a measure of financial performance that calculates the proportion of net income generated by a company's equity. A higher ROE demonstrates the efficient usage of shareholders' investments.

Conducting a thorough analysis of the company's financial statements is crucial. This includes reviewing income statements, balance sheets, and cash flow statements. By doing so, investors can gain insights into the company's profitability, liquidity, and solvency.

Another important factor to consider is a company's cash position. Adequate cash reserves enable a company to meet its short-term obligations and invest in growth opportunities. On the other hand, a lack of cash can leave a company vulnerable to market fluctuations and financial stress.

It is also essential to evaluate a company's capital structure, which refers to the proportion of debt and equity financing it uses to fund its operations. A balanced capital structure ensures financial stability, while excessive debt may lead to financial distress.

Examining a company's debt level is crucial, as it can directly impact the company's financial flexibility and risk profile. A high level of debt can hinder a company's ability to grow and adapt to changes in the market, making it a less attractive investment option.

Assessing a company's assets and how they're managed plays a significant role in evaluating an investment opportunity. This includes tangible assets, such as property and equipment, and intangible assets, such as patents and trademarks. Effective asset management contributes to a company's ability to generate profit.

Finally, it is important to scrutinize a company's costs associated with its operations, such as production costs and overhead expenses. A company that efficiently manages its costs will likely generate higher profitability and provide better returns for investors.

Creating Value through Strategic Planning

Strategic planning plays a crucial role in creating value for investors and businesses. It serves as the foundation for effective decision-making and guides companies towards achieving their goals. Through strategic planning, management teams can identify and focus on core competencies that contribute to a company's competitive advantage.

One way to create value is to prioritize revenue growth. By identifying key growth drivers, such as product innovation or market expansion, companies can allocate resources accordingly to boost earnings. Such targeted investments in growth engines allow firms to capture a larger market share and drive long-term profitability.

Another aspect of strategic planning involves optimizing a company's holdings. By assessing the existing portfolio, management can decide whether to divest underperforming assets or make strategic acquisitions that align with their investment thesis. The right combinations and adjustments can significantly enhance a company's overall performance and shareholder value.

Risk management is also an essential aspect of strategic planning. Companies must assess potential risks and incorporate suitable mitigation measures in their plans. This ensures that organizations are prepared for unforeseen circumstances, which can safeguard profits and protect the company's assets.

Furthermore, creating value requires continuous improvement and adaptation to market trends. Companies should routinely reevaluate their strategies to identify both internal and external factors that may impact their current position. By setting clearly defined objectives and quantifiable financial targets, management teams can measure their progress effectively and adjust their strategic plans as needed.

In summary , creating value through strategic planning involves a combination of focusing on core competencies, prioritizing revenue growth, optimizing holdings, managing risk, and continuously reassessing the company's strategic direction. This holistic approach can help businesses enhance their profitability, strengthen their market position, and ultimately deliver strong value creation to investors.

Understanding the Market and Competition

Before developing an investment thesis, it is crucial to have a deep understanding of the market and its competition. The stock market is influenced by various factors such as economic supercycles, bear markets, and secular trends. Analyzing these elements will provide a solid foundation to recognize potential investment opportunities.

An economic supercycle is a long-term pattern that occurs over several decades, during which the economy undergoes periods of growth and contraction. Investors need to be aware of the current phase and how it may impact their investment decisions. For instance, during a growth period, certain industries tend to outperform, while others may underperform during a contraction phase.

In addition to analyzing these market conditions, investors must also pay heed to the competitive landscape of the sector in which they plan to invest. Examining the competitors within the industry enables one to identify companies with competitive advantages, which may lead to superior performance. These advantages can stem from factors such as lower costs, innovation, or a dominant market share.

A bear market occurs when the stock market experiences a prolonged decline, typically characterized by a decrease of 20% or more from recent highs. In such environments, it becomes even more crucial for investors to understand the competitive dynamics within an industry to identify resilient companies that can withstand market downturns.

A secular trend is a long-term movement in a particular direction that can last for several years or even decades. Identifying secular trends within industries is essential to spotting opportunities for long-term growth. For example, investors may capitalize on sectors benefiting from a shift towards clean energy usage or the increasing importance of artificial intelligence.

In summary, understanding the market and competition requires a deep analysis of the stock market, economic supercycles, bear markets, and secular trends. By researching industry trends, evaluating market opportunities, and assessing the strengths and weaknesses of competitors, investors can develop a robust investment thesis that increases the likelihood of achieving long-term returns.

Industry Case Studies

In the investment world, the importance of an investment thesis cannot be overstated. By examining various industry case studies, we can gain insight into how businesses make strategic investments to enhance their value. In this section, we'll discuss notable examples from companies such as DuPont, General Motors, Rexam PLC, and Clear Channel Communications.

DuPont is a leading science and innovation company with a focus on agriculture, advanced materials, and industrial biosciences. During its acquisition of Dow Chemical, DuPont developed a robust investment thesis to justify the merger. Their investment case relied on the belief that the combined entity would benefit from increased operational efficiencies, new market opportunities, and enhanced innovation capabilities. This approach provided a strong rationale for the deal, which has created a more competitive company in the global market.

General Motors (GM) , a multinational automobile manufacturer, crafted its investment thesis in response to evolving trends in the automotive industry, such as the increasing importance of emissions reduction, electrification, and autonomous technology. GM's investment case centered on embracing these trends, focusing on innovation, and expanding its product offerings through strategic M&A, investments, and partnerships. For example, GM has made significant investments in electric vehicles and autonomous driving technology, positioning the company for future growth in these areas.

Next, we have Rexam PLC , a former British packaging manufacturer that was a leading producer of beverage cans globally. When Ball Corporation sought to acquire Rexam, they developed an investment thesis based on the value derived from combining the two companies' strengths. This thesis outlined the strategic fit between both companies, synergies from combining production capabilities, and projected growth, particularly in developing markets. The successful acquisition helped Ball Corporation consolidate its position as a global leader in the packaging industry.

Lastly, Clear Channel Communications is a media company specializing in outdoor advertising. As the company sought to expand its presence in this sector, it created an investment thesis centered around leveraging its core competence in outdoor advertising and acquiring strategic assets. One example is Clear Channel's acquisition of crucial billboard locations to solidify its competitive edge in the outdoor advertising market. This targeted growth strategy has allowed Clear Channel to remain a dominant player in the industry.

In conclusion, these industry case studies demonstrate the value of a well-crafted investment thesis. Effective investment theses provide a roadmap for companies to pursue strategic acquisitions and investments that create long-term value, while also helping investors evaluate the viability of proposed deals. By understanding how companies like DuPont, General Motors, Rexam PLC, and Clear Channel Communications have strategically invested in the market, we can better appreciate the importance of a well-structured investment thesis.

Long-Term Investment Strategies

A long-term investment strategy refers to an approach where investors hold onto their investments for an extended period, typically more than one year. This type of strategy aims to achieve the investment goal by allowing assets to grow through market fluctuations and capitalizing on the power of compounding interest. Diversification and patience play pivotal roles in ensuring the success of a long-term investment strategy.

Portfolio managers often use various techniques and methods to craft long-term investment portfolios. Some of these techniques include targeting undervalued sectors or stocks, dividend reinvestment plans, dollar-cost averaging, and asset allocation. By employing these strategies, portfolio managers increase chances of achieving their clients' investment goals over time.

In order to develop long-term investment strategies, investors should first define their investment goal . This could include objectives such as saving for retirement, funding a child's college education, or purchasing a home. Clear investment goals help in designing an appropriate investment strategy, taking into account factors like the investor's risk tolerance, time horizon, and available capital.

One key aspect of a successful long-term strategy is diversification . Diversifying across asset classes and industries allows investors to spread risks and potentially achieve higher risk-adjusted returns. A well-diversified portfolio will typically consist of a mix of stocks, bonds, and other asset types, with variations in investment size, industry sector, and geographical location. This diversified approach minimizes the impact of underperforming investments on the overall portfolio.

Another crucial element in long-term investing is patience . Market fluctuations can be tempting for investors to react to their emotions and make impulsive decisions, which could derail a well-thought-out investment strategy. Maintaining a disciplined approach and sticking to one's investment plan, even during periods of market volatility, is paramount to achieving long-term success.

In conclusion, long-term investment strategies require investors to define clear goals, diversify their portfolio, and exercise patience in the face of market fluctuations. By adhering to these principles, investors and portfolio managers can steer a course towards achieving their investment objectives.

Emerging Trends and Opportunities

In recent years, various emerging trends have presented attractive opportunities for investors. Among these trends, renewable energy, megatrends, and the coffee shop market stand out as sectors with significant potential for growth.

Renewable energy has gained considerable attention and investment as a response to the global push for addressing climate change and reducing emissions. Solar, wind, and hydroelectric power are some of the most prominent technologies in this sector. With an increased interest in clean energy from both governments and consumers, companies in this space are poised to experience substantial growth.

Megatrends such as urbanization, aging populations, and technological advancements are also influencing investment opportunities. These large-scale shifts provide a backdrop for businesses to tap into new markets and adjust their strategies to capitalize on these changes. For instance, companies working in healthcare and biotechnology may benefit from catering to the needs of an aging population, while businesses focused on artificial intelligence (AI) and automation may find increased demand due to technological advancements.

The coffee shop market, too, presents investment opportunities. This industry has experienced robust growth in recent years as consumers increasingly seek out unique, high-quality coffee experiences. Independent and specialty coffee shops are at the forefront of this trend. Niche coffee shops that offer novel and authentic experiences have seen success by catering to the specialized preferences of today's consumers. As the demand for artisanal and premium beverages continues to rise, businesses operating in this space can expect to have ample opportunities for growth.

In conclusion, current emerging trends such as renewable energy, megatrends, and the coffee shop market offer a wealth of investment opportunities. As these sectors continue to develop and evolve, investors with well-informed investment theses stand to benefit from the potential rewards in these growing industries.

Role of Financial Statements and Valuation Metrics

Financial statements play a vital role in the investment thesis by providing crucial information about a company's financial health and performance. They consist of the balance sheet, income statement, and cash flow statement, which offer insights into the company's assets, liabilities, revenues, expenses, and cash flows. Investors use these statements to assess the company's past performance, current financial condition, and potential for future growth.

Valuation metrics, on the other hand, are vital yardsticks that investors use to compare different investment opportunities and make informed decisions. These metrics include price-to-earnings (P/E) ratio, price-to-sales (P/S) ratio, price-to-book (P/B) ratio, dividend yield, and return on equity (ROE), among others. By analyzing these ratios, investors can gauge a company's value relative to its peers and make better investment choices.

Analysts and investors scrutinize financial statements to identify growth trends, profitability, and financial stability. For instance, they may calculate the gross margin, operating margin, and net profit margin to determine the company's profitability across different stages of its operations. Additionally, they examine liquidity ratios, such as the current ratio and quick ratio, to assess the company's ability to meet its short-term obligations.

Valuation metrics provide a quantitative basis for comparing investment opportunities within the same industry or across different sectors. For example, a lower P/E ratio may indicate that a stock is undervalued, while a high P/E ratio might suggest overvaluation. Moreover, the P/B ratio can help investors determine if a stock is undervalued by comparing its market price to its book value.

Another key valuation metric is the dividend yield, which measures the annual dividend income per share relative to the stock's price. A higher dividend yield may attract income-oriented investors, while a lower yield might be more appealing to growth-focused investors. Furthermore, the ROE ratio, which measures a company's profitability in relation to its equity base, is an essential metric for evaluating the efficiency of management in creating shareholder value.

In conclusion, financial statements and valuation metrics are indispensable tools for investors to evaluate a company's financial health and investment attractiveness. By analyzing these data points, investors can make well-informed investment decisions that align with their risk tolerance and investment objectives.

Concluding Thoughts on Crafting a Compelling Investment Thesis

Crafting a compelling investment thesis is crucial for informed investing decisions, as it helps investors thoroughly analyze a potential opportunity. A well-researched investment thesis demonstrates the investor's conviction level and reinforces their confidence in the investment choice. This process involves a deep understanding of the business, its value drivers, and its potential growth trajectories.

A strong investment thesis should be definitive, clearly articulating the reasoning behind the opportunity and the expected returns. This allows investors to stay focused on their goals and maintain their conviction, even when the stock's price movement does not align with their expectations.

By adopting a confident, knowledgeable, and neutral tone, investors can effectively communicate their investment thesis to others. Clarity in presenting the investment case is essential for persuading potential partners or stakeholders to support the opportunity. Utilizing formatting tools such as tables and bullet points can aid in conveying essential information efficiently and ensuring the investment thesis is easy to understand.

In summary, crafting a compelling investment thesis enables investors to make well-informed decisions that align with their financial goals. By developing a thorough understanding of the investment opportunity and maintaining a strong conviction level, investors can better navigate the market and achieve long-term success.

Frequently Asked Questions

How do you develop a strong investment thesis.

A strong investment thesis begins with thorough research on the company or asset in question. This may include looking at the financials, competitive position, management team, industry trends, and future prospects. It's essential to critically analyze the available information, identify potential risks and rewards, and establish a clear rationale for the investment based on this analysis. Staying focused on the long-term outlook and maintaining a disciplined approach to the investment process can also contribute to developing a robust investment thesis.

What are the key elements to include in an investment thesis?

An investment thesis should include the following key elements:

  • Overview of the company or asset: Provide a brief background of the company or asset, including its market, size, and competitive positioning.
  • Investment rationale: Detail the reasons for investing, such as attractive valuation, strong revenue growth, or a unique business model.
  • Risk assessment: Identify potential risks and how they could impact the investment returns.
  • Expected return: Estimate the potential financial return based on the identified growth drivers or catalysts.
  • Time horizon: Indicate the investment period, typically long-term, during which the thesis is expected to play out.
  • Fund size: Specify the amount of invested capital that will be allocated to this particular investment, considering its impact on portfolio construction, liquidity, and potential returns within the overall portfolio strategy

How can one evaluate the success of an investment thesis?

Evaluating the success of an investment thesis involves tracking the progress of the company or asset against its initial expectations and underlying assumptions. This may involve measuring financial performance, analyzing key developments in the industry and the company's position within it, and monitoring potential changes in overall market conditions. It is helpful to revisit the investment thesis regularly to assess its validity and make adjustments as necessary.

What's the difference between an investment thesis for startups and publicly traded companies?

An investment thesis for a startup often focuses on the growth potential of a new or emerging market, considering the innovative products or services the startup offers in that market. Here, the focus may be more on the potential for long-term value creation, the management team's ability to execute on their vision, and market fit.

For publicly traded companies, the investment thesis may include analysis of current financial performance, valuation multiples, and overall market trends. Publicly traded companies have more historical data and financial performance information available, allowing investors to make more informed decisions based on these factors.

How does an investment thesis guide decision-making in private equity?

In private equity, the investment thesis helps guide the selection of companies to invest in, as well as the structuring of deals to acquire those companies. It provides a blueprint for how the private equity firm aims to create value, including plans for operational improvements, financial engineering, or growth strategies. This thesis serves as a basis for monitoring the progress of an investment and helps make decisions on the timing of potential exits.

How can real estate investment theses differ from other sectors?

Real estate investment theses may focus on factors such as location, property type, market dynamics, and demographic trends to identify attractive investment opportunities. The analysis may also take into account macroeconomic factors, such as interest rates and economic growth, which can influence real estate markets. Additionally, real estate investments may be structured as either direct property investments or through financial instruments like Real Estate Investment Trusts (REITs), affecting the underlying investment thesis.

What considerations should a first-time fund manager have when developing a fund's investment thesis?

For a first-time fund manager, crafting a compelling and robust fund's investment thesis is paramount for attracting investors. Given their lack of a track record, these managers need to lean heavily on the research, clarity, and vision articulated in their investment thesis. The thesis should detail how the fund aims to identify ideal investments, especially those in industries with high margins. It should also benchmark the strategies against industry standards to highlight the manager's acumen and awareness of market norms.

How is a stock pitch related to an investment thesis and what role does a target price play in it?

A stock pitch is essentially a condensed, persuasive form of an investment thesis, often presented to stakeholders to advocate for investing in a particular publicly-traded company. A key element of any stock pitch is the target price, which is an estimation of what the stock is worth based on projections and valuation models. This target price serves as a quantitative anchor for the investment thesis, giving stakeholders a specific metric against which to measure potential returns and risks.


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Investment Thesis Template

Create your own investment thesis slide with this free template

Hassan Saab

Prior to becoming a Founder for Curiocity, Hassan worked for Houlihan Lokey as an Investment Banking Analyst focusing on sellside and buyside  M&A , restructurings, financings and strategic advisory engagements across industry groups.

Hassan holds a  BS  from the University of Pennsylvania in Economics.

Adin Lykken

Currently, Adin is an associate at Berkshire Partners, an $16B middle-market private equity fund. Prior to joining Berkshire Partners, Adin worked for just over three years at The  Boston Consulting Group as  an associate and consultant and previously interned for the Federal Reserve Board and the U.S. Senate.

Adin graduated from Yale University, Magna Cum Claude, with a Bachelor of Arts Degree in Economics.

investment thesis education

This template allows you to create your own investment thesis slide detailing your overall strategy.

The template is plug-and-play , and you can enter your own text or numbers. The template also includes other slide pages for other elements of a financial model presentation.

According to the WSO Dictionary ,

"An investment thesis aims to take an abstract idea and turn it into a functional investment strategy. An investment thesis helps investors evaluate investment ideas, ideally guiding them in selecting the best ideas that can help meet their investment objectives."

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Investment Thesis Template

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Joel M. Dickson, Ph.D., is Vanguard’s global head of enterprise advice methodology. He oversees all investment methodology development for Vanguard’s advice programs, including Vanguard Personal Advisor Services and Vanguard Digital Advisor. Among his areas of expertise are investment strategy, portfolio construction, tax efficiency, portfolio management, exchange-traded funds (ETF), and alternative investments.

Joel chairs Vanguard’s Advice Policy Committee and is a member of Vanguard’s Strategic Asset Allocation Committee.

Since joining Vanguard in 1996, Joel has held a number of senior investment-related roles. He led Vanguard’s ETF Industry Thought Leadership Research Team in Vanguard Investment Strategy Group, analyzing trends and developments in the ETF market. He served as head of the Active Quantitative Equity Group with oversight responsibility for all research and portfolio management activities associated with Vanguard’s internally managed active equity portfolios. Prior to those roles, he held analyst positions in Vanguard’s Portfolio Review Group.

Before joining Vanguard, Joel worked as a staff economist at the Federal Reserve Board. He has testified before U.S. congressional committees on Social Security reform and mutual fund disclosure issues, and he is often quoted in the news media on tax-efficient investing, retirement savings strategies, and ETF industry and product issues.

Joel earned an A.B. from Washington University in St. Louis and a Ph.D. in economics from Stanford University.

"Beware of little expenses; a small leak will sink a great ship."

—benjamin franklin, poor richard’s almanack.

The notoriously thrifty Ben Franklin understood the great erosion that results from a slow drip of assets. Perhaps that's why he famously bemoaned the certainty of taxes, which to be frank, may not be quite immovable a force as the founding father implied.

That is, a tax bill may be an inevitability, but investors can delay or control that bill, which can lead to better investor outcomes.

There is little doubt that taxes are one of the largest costs faced by many investors today. Other investment-related fees—asset-weighted average expense ratios, for example—have fallen substantially in past decades.

And the potential for investors to benefit from cost savings is significant. We ran an analysis on the outcome of a hypothetical $100,000 investment with a 6% reinvested return at different cost levels. Whether those costs stem from transaction fees, advice, or Uncle Sam's cut, the inevitable outcome is clear. Higher costs crimp a portfolio's growth unless there is additional value derived from paying those costs.

A penny saved on fees is a penny that keeps compounding

Notes: The portfolio balances shown are hypothetical and do not reflect any particular investment. In this example, the accounts return 6% annually, then investment costs are taken at the end of the year. The rate of return is not guaranteed. The final account balances do not reflect any taxes or penalties that might be due upon distribution. Costs are one factor that can impact returns. There may be differences between products that must be considered prior to investing.

Source: Vanguard calculations.

That cost-cut triumph can be a boon for investors who seek out low-cost investments. And yet, investment fees are just one side of the cost coin. The flip side—taxes—can take an even bigger bite from returns.

The good news is that tax costs can be controlled in many instances. Investors just need to know how.

Investment tax efficiency: hierarchy of opportunity

Take advantage of tax-advantaged accounts. For many investors, the low-hanging tax fruit is their 401(k), IRA, or other tax-advantaged retirement plan. In terms of order, Vanguard recommends a retirement plan first, if one is available, up to the amount that captures the employer match. What should come after that is not always clear-cut but a combination of tax-deferred and after-tax (e.g., Roth) accounts can offer flexibility when accounting for an investor's time horizon, expected future tax rate, and income flexibility needs in retirement (to offset Social Security and Medicare tax cliffs, for example).

Outside of retirement planning, certain health savings accounts (HSAs) and education savings plans (e.g., 529s) can also offer attractive tax advantages worth considering.

Control tax costs through trading and asset placement strategies. Tax-aware investors can strategically hold or sell from a brokerage account to lower capital gains tax or harvest losses for a later offset. Attractive yet tax-inefficient investments—like an actively managed mutual fund with higher turnover—can be held inside a tax-advantaged account, so dividend or short-term capital gains payouts can remain sheltered. In short, a little investor education on tax treatment can go a long way toward generating better after-tax portfolio returns.

Reduce tax penalties. Retirement savers may be unaware of the full impact of an early withdrawal, the taxable event one may create, or the potential penalty. Advice is often the key link that can help an investor make tax-efficient, cost-conscious decisions—even during a time of need—that can increase the likelihood of keeping long-term goals on track.

The stakes are high

Taxes may be one of two certainties in life, but investors don't have to pay more than their due.

With the help of advisors, tax professionals, and client-centric education, investor tax bills could be meaningfully minimized. More widespread use of holistic, tax-aware planning strategies, and better tax-related communications, disclosures, and educational efforts could go a long way toward getting investors closer to their financial goals.

At the end of the day, it's not how much investors earn that defines success. It's how much they keep.

Explore more investing strategies

Related links:

Vanguard's principles for investing success  (research, issued November 2023)

Flipping the script on how we talk about investing success  (article, issued December 2023)

Prep for the new year with these five simple tax tips  (article, issued December 2023)

Greater tax efficiency through equity asset location  (research summary, issued October 2023)

Most Viewed

Start with this step-by-step guide to opening a personal investment account, such as a general investing brokerage account or an IRA.

Neither Vanguard nor its financial advisors provide tax and/or legal advice. This information is general and educational in nature and should not be considered tax and/or legal advice.

Any tax-related information discussed herein is based on tax laws, regulations, judicial opinions, and other guidance that are complex and subject to change. Additional tax rules not discussed herein may also be applicable to your situation. Vanguard makes no warranties regarding such information, or the results obtained by its use, and disclaims any liability arising out of your use of, or any tax positions taken in reliance on, such information. We recommend you consult a tax and/or legal advisor about your individual situation.

More From Forbes

How investment in education r&d by texas policy leaders could spur economic growth.

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Texas has a rich history as a leader in innovation. State policy leaders could help it have an even ... [+] richer future as a leader in R&D education.

Texas has a rich history as a leader in innovation. The Lone Star State is responsible for game-changing inventions like the handheld calculator, 3D printing – and even the frozen margarita. It’s the home of NASA’s Houston Space Center, Texas Instruments, and Dell Computers.

Today, Texas continues to burnish its legacy as a state on the cutting edge by attracting high-tech businesses like Tesla, SpaceX, Oracle, and Blue Origin. Its economy is humming, growing at a faster rate than the nation’s economy overall. Over the last three years, nearly 140 companies have moved to Texas, drawn by factors such as appealing business incentives and robust research and development at its colleges and universities.

Yet, the state’s pipeline of future engineers, teachers, technologists, and business leaders is in danger of running dry. Everyday young Texans go to schools across the state facing challenges worsened by, and some exposed by, the COVID-19 pandemic. Chronic absenteeism. Declining test scores. Teacher shortages.

What’s the solution? In short, the answer is top-tier, research-backed innovations supporting K-12 students, families, and educators.

All Eyes On Texas

For education reformers, all eyes are on Texas, which has long been a leader in national-level innovation.

Indeed, this is why Texan leaders in Congress should lead the charge to establish a National Center for Advanced Development in Education (NCADE) – essentially, an Advanced Research Projects Agency (ARPA) for education . This new center would take on smart, high-reward R&D, like the U.S. did in the late 1950’s when it created the Defense Advanced Research Projects Agency (DARPA) as a response to Sputnik.

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Best 5% interest savings accounts of 2024.

DARPA’s approach to transformative R&D has produced innovations like the Internet, GPS, and RNA vaccines. Imagine what the brightest minds in our country could develop for students and teachers if we took that same approach for education.

Proponents of the work include both the Director of the Institute of Education Sciences (IES), the U.S. Department of Education’s research arm, and well-respected education researchers in Texas like Peter Bergman.

Mark Schneider, the Director of IES whose six-year term is ending this week, asserts that the innovations that come out of NCADE will strengthen American education, particularly in STEM fields , and prepare younger generations for the jobs of the future. Schneider also makes the case that a skilled workforce, able to produce or adapt to the latest global innovations, will bolster national security . Recognizing the need for bolder, faster, more responsive R&D, Schneider and his team have been thoughtful stewards of the $30 million Congress directed to IES for what many consider to be an NCADE pilot. They understand that Congress can build on the pilot by authorizing NCADE and making informed-risk, high-reward R&D in education a sustained effort, rather than a one-off experiment.

Tapping Into AI’s Potential

Just as important, there are many in Texas along with diverse coalitions like the Alliance for Learning Innovation , which I’m a part of, that are calling for NCADE. Peter Bergman of the University of Texas-Austin and Learning Collider , a social science research lab, argues that recent advancements in artificial intelligence make this the right time to create an ARPA for education.

As Bergman notes, AI is advancing full force, particularly large language models like ChatGPT, Gemini, and Claude. Paired with a solid base of research in the science of learning, emerging technologies like AI could be developed purposefully and driven by evidence to measurably improve K-12 education.

NCADE-backed projects could leverage AI to improve feedback to students and teachers, build digital learning platforms that support personalized learning, develop Siri-like voice recognition software to assess literacy readiness gaps, or scale novel learning models to improve instructional quality – all while keeping data protected. These innovations would enable schools to make dramatic advances in teaching and learning, increasing students’ academic engagement and achievement, and creating the workforce needed to keep Texas – and the rest of the country – innovating for decades to come.

Investing In Rural Tech Talent

The opportunity for NCADE comes at a time when industry employers in Texas are rightfully worried about unfilled job vacancies in AI and other emerging technology fields, like semiconductors, cybersecurity, and advanced manufacturing. The president of the Texas Business Leadership Council is calling for the state to produce a larger pool of qualified workers for middle- and high-skill roles.

That struggle is felt keenly in small Texas towns that are grappling with labor shortages for jobs that require licenses and higher education degrees. North Texas has become an innovation hub but is experiencing a shortage of tech talent. Thanks to the CHIPS and Science Act, North Central Texas is home to the newly designated Texoma Semiconductor Tech Hub – but its success rides on the education and training of its residents.

NCADE-funded innovations could address all of those challenges by preparing students for careers in those advanced technology fields. With the innovative tools and resources, educators and school leaders will be able to cultivate future generations of technically-skilled and knowledgeable STEM professionals and technicians. Investing in STEM talent will fuel economic growth and maintain Texas’ competitive edge.

It’s up to Congress to make NCADE a reality — something that can be done by introducing and passing the New Essential Educational Discoveries (NEED) Act . The NEED Act was introduced last year in the U.S. House of Representatives and will soon be introduced in the U.S. Senate.

Supporting education R&D to spur innovations in teaching and learning seems to be one of the few bipartisan issues people can all rally around. A chance to seize this moment – where steep challenges are matched by huge opportunities — now exists. Policy leaders can invest in the type of high-potential, high-impact R&D projects Texas students need to be prepared for a bright future. By embracing NCADE, Texas can be at the forefront of innovation and forever improve its educational landscape and ensure the state’s businesses have the skilled employees they need to grow and thrive.

Ulrich Boser

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Yolo Investments backs TON in widespread $8m investment


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Yolo Investments , the venture capital firm focused on gaming, fintech, blockchain, and emerging technologies, has joined The Open Network (TON) with an $8M USD investment both in Toncoin and across the TON ecosystem.

TON Backing and Partnership 

Yolo Investments has invested in several TON start-ups, including Tonstarter, Fanton and PlayDeck (formerly known as Ton Play). The partnership will also see the TON Foundation and Yolo Investments supporting the growth of , an established leading crypto education portal, which will also include new content focused on TON.

Justin Hyun, Director of Growth at TON Foundation stated:  

“We are excited to have Yolo Investments join TON with all-around support for the ecosystem. Yolo Investments have demonstrated commitment to the ecosystem by investing in various projects. We believe that their thesis of crypto mass adoption via Telegram, specifically gaming, aligns with our go-to-market strategy. We look forward to working with Yolo Investments to bring crypto to the masses via platforms such as and @wallet – the native crypto wallet inside telegram.”

900 Million Monthly Users

Yolo Investments was drawn to TON because of its user-centric focus and mission to provide 500 million people with access to digital assets by 2028. While other blockchains have tended to build before finding a user base, TON has added significant value to Telegram’s already large cohort of users, which recently topped 900 million monthly active users. The success of @wallet supports Yolo Investment’s thesis that bringing crypto products to users instead of the reverse, is the best way to mainstream the technology.

Tim Heath, GP at Yolo Investments , commented on the investment, stating:

“We’ve long supported TON’s mission to build a truly decentralized, open-source future, and we’re now putting our money where our mouth is. But beyond our significant investment, we’re also committed to a deep collaboration, drawing upon our years of experience in this space, to help TON further develop the web3 SuperApp that’s already changing how people spend, save, and play.

With over 1 million sign-ups in a matter of weeks, @whale, one of our portfolio companies, which has become a superbot on telegram, has quickly grown to have over 15,000 daily active players within the TON ecosystem. This is a perfect example which exemplifies Yolo Investment’s shared vision for a vibrant Web3 ecosystem, where gaming and digital ownership converge successfully in Telegram.”

The collaboration between Yolo Investments, (with assets under management exceeding €620 million) and the TON Foundation marks a significant opportunity to begin a new era of innovation and accessibility between The Open Network and Yolo Investment’s portfolio of forward-thinking companies.

About Yolo Investments

Yolo Investments is a venture capital firm focused on seed and A-stage investment opportunities across the gaming, crypto and fintech sectors. Having successfully matured its first Fund I, vintage 2018, Yolo Investments, which is regulated by the Guernsey FSC, has recently launched its second €100m Fund II, with its continued thesis to invest in emerging, disruptive technologies, led by outstanding people with bright ideas focused on innovation and disrupting the industry norms.

For more information, please visit:

About The Open Network

The Open Network (TON) is a global, decentralized blockchain community focused on putting crypto in every pocket. By building the Web3 ecosystem in Telegram Messenger, TON’s vision is to empower 500 million users to own their digital identity, data, and assets by 2028. Learn more at .

Media Contact Details

Contact Name : Claudia Lama

Contact Email : [email protected]       

Yolo Investments is the source of this content. This Press Release is for informational purposes only. The information does not constitute investment advice or an offer to invest. 

Disclaimer: This is a paid post and should not be treated as news/advice.


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Wednesday, March 27, 2024

Office of Graduate Education and Life announces Three-Minute Thesis finalists

3-Minute Thesis

Ten doctoral students will compete in the grand finale beginning at 6 p.m. Wednesday, April 3, in the Mountainlair Ballrooms as five faculty and staff members judge for first, second and third place winners. 

The WVU community is also invited to attend and vote for the People’s Choice Award.

The internationally renowned 3MT competition, originally founded by the University of Queensland in Australia, challenges doctoral students to present their research topic and its significance in three minutes using a single PowerPoint slide. 

Competitors develop academic, presentation and research communication skills while gaining experience pitching their research succinctly to a non-specialist audience. 

The 2024 finalists are as follows: 

Haidar Aldaach, Civil Engineering, Statler College of Engineering and Mineral Resources

Syeda Nyma Ferdous, Computer Engineering, Statler College of Engineering and Mineral Resources 

Tanner Hoffman, Plant and Soil Sciences, Davis College of Agriculture, Natural Resources and Design 

Brian Leonard, Chemical Engineering, Statler College of Engineering and Mineral Resources 

Kushal Naharki, Plant and Soil Sciences, Davis College of Agriculture, Natural Resources and Design 

Kinsey Reed, Plant and Soil Sciences, Davis College of Agriculture, Natural Resources and Design 

Denis Ruto, Environmental Engineering, Statler College of Engineering and Mineral Resources 

Kayla Steinberger, Immunology, School of Medicine 

Vaishakhi Suresh, Industrial and Management Systems Engineering, Statler College of Engineering and Mineral Resources 

Paige Zalman, Higher Education, College of Applied Human Services 

Grand finale prizes include $1,000 for first place, $750 for second place, $500 for third place and $250 for the People’s Choice Award.

Find more information on the 3MT competition.

For questions, contact Betty Mei at [email protected]


IOE - Faculty of Education and Society

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IOE alumni named winners of the 2024 BERA Master’s Dissertation and Doctoral Thesis awards

27 March 2024

Dr Emily Macleod (PhD) and Kate Fox (Education and International Development MA) have won the British Educational Research Association (BERA) Doctoral and Master’s Thesis prizes respectively.

Left: Emily Macleod. Right: Kate Fox. Image permission: Emily Macleod and Kate Fox.

The awards are given in recognition of academic excellence and research rigour within the field of educational research. 

Emily Macleod won for her thesis, “The status and safety of teaching: A longitudinal study of why some young people in England become teachers, and why others do not.” She investigated young people’s motivations behind pursuing – or not pursuing – the profession amidst the context of national and international teacher shortages. 

She completed her PhD at IOE’s Department of Education, Practice and Society in 2023, and was a co-host on IOE’s podcast series Research for the Real World . She continues on as an honorary postdoctoral fellow. She also worked on the ASPIRES research project studying young people's science and career aspirations, before which she was a secondary school teacher. 

Kate Fox won for her MA dissertation entitled “Building bridges or barriers? A study of home, community, and school literacy practices in rural Tanzania.”

Her dissertation centres the experiences of parents from rural communities within the Tanzanian education system – and the diverse ways families and communities contribute to young children’s literacy learning.

Kate completed her Master’s degree at IOE in 2023. She is now a Research Officer with the IOE Research Development team, and a Research Assistant working on two multi-institutional projects: Climate-U and Equitable research cultures . Her career in education spans 20 years as a teacher, headteacher and teacher trainer in Tanzania and the UK.

Related links

  • Read more: BERA announces 2024 Master’s Dissertation and Doctoral Thesis winners
  • Emily on ‘Why do people aspire to become teachers?’ RFTRW: S19E03
  • More about Kate Fox
  • More about Dr Emily Macleod 
  • Research for the Real World podcast
  • ASPIRES project

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Emily Macleod (left) and Kate Fox (right).

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The bridge: translation from, for and to april 12 & april 13, 2024.

The Bridge_Tribute to Monica Otter

The Leslie Center for the Humanities, The Office of the Associate Dean for Interdisciplinary Programs, The Department of English & Creative Writing and The Comparative Literature Program Presents:

The Bridge Translation From, For and To An event in honor of Monika Otter Conversations with translators, publishers and editors on bridging distances in language and culture.

Featured Speakers: Barbara Epler Alta Price Daisy Rockwell Jill Schoolman Jonathan Smolin Alex Zucker

Friday, April 12 Public Event 3:45-5:30 PM Sanborn Library

Saturday, April 13 Translation Workshops for Students Students please register below 10:30-12:00 PM Sanborn Library



Scan the QR code to register for a spot in the translation workshops

Questions? Please write to [email protected] .

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Biden-Harris Administration Invests in Clean Energy and Fertilizer Production to Strengthen American Farms and Businesses as Part of Investing in America Agenda

Projects Funded by President Biden’s Inflation Reduction Act Will Lower Energy Costs and Create Revenue for Rural Business Owners and Farms

OMAHA, Neb., March 28, 2024 – U.S. Department of Agriculture (USDA) Secretary Tom Vilsack today announced that USDA is investing $124 million in renewable energy and fertilizer production projects in 44 states to lower energy costs, generate new income and create jobs for U.S. farmers, ranchers, agricultural producers and rural small businesses.

The Secretary made the announcement during a visit to University of Nebraska Omaha, where he discussed USDA’s efforts under the Biden-Harris Administration to invest in rural communities nationwide. Most of the projects announced today are being funded by President Biden’s Inflation Reduction Act, the nation’s largest-ever investment in combating the climate crisis, through the Rural Energy for America Program . An additional project is funded by the Fertilizer Production Expansion Program . In total, this funding advances the President’s Investing in America agenda to grow the nation’s economy from the middle out and bottom up by increasing competition in agricultural markets, lowering costs and expanding clean energy.

“Under the Biden-Harris Administration, USDA is committed to ensuring farmers, ranchers and small businesses are directly benefitting from both a clean energy economy and a strong U.S. supply chain,” Secretary Vilsack said. “The investments announced today will expand access to renewable energy systems and domestic fertilizer, all while creating good-paying jobs and saving people money that they can then invest back into their businesses and communities.”

This visit comes just weeks after USDA selected Midwest Electric Cooperative , located in Grant, NE, and the Village of Emerson, NE as two of its first applicants to move forward in the awards process through the Powering Affordable Clean Energy program. Midwest Electric Cooperative will build solar renewable energy resource facilities and energy storage systems for the communities in Wallace, Grant, Paxton and Lakeview. The Village of Emerson plans to use the funds to finance a solar facility that will distribute clean energy to the Winnebago Tribe.

Rural Clean Energy Production

Today’s announcement includes an investment of over $120 million in 541 Rural Energy for America Program (REAP) projects across 44 states.

Through the REAP program, USDA provides grants and loans to help ag producers and rural small business owners expand their use of wind, solar and other forms of clean energy and make energy efficiency improvements. These innovations help them increase their income, grow their businesses, address climate change and lower energy costs.

The REAP program is part of the President’s Justice40 Initiative , which set a goal to deliver 40% of the overall benefits of certain federal investments to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.

These investments will cut energy costs for farmers and ag producers that can instead be used to create jobs and new revenue streams for people in their communities. For example:

  • In Nebraska, Darr Grain will install three 15-kilowatt (kW) wind turbines at a grain storage facility. This project is expected to save the business $9,700 in electrical costs per year and generate more than 138,000 kilowatt hours (kWh) of electricity per year. This represents 77% of the company’s energy use, which is enough to power nine homes.
  • In Maine, Moorit Hill Farm will install a 40.95 kW roof mount solar system. The system will save the farm more than 50,000 kWh per year, which is equivalent to approximately 100% of the farm’s energy use. This is enough clean energy to power nearly five homes, replace 50,000 pounds of burning coal, or replace approximately eight gasoline powered cars.
  • In Idaho, Boulder Creek Oz will purchase and install a biomass furnace to provide additional heat to their cabins and mountain lodging facilities in Boundary County. This project is expected to save more than $3,800 per year. It will replace more than 3,700 kWh, which is approximately 94% of the energy use per year.

USDA is making the REAP awards in Alabama, Alaska, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia, Washington, Wisconsin and Wyoming.

Since the start of the Biden-Harris Administration, USDA has invested more than $1.8 billion through REAP in over 6,000 renewable energy and energy efficiency improvements that will help rural business owners' lower energy costs, generate new income, and strengthen their resiliency of operations.

USDA continues to accept REAP applications and will hold funding competitions quarterly through September 30, 2024. The funding includes a dedicated portion for underutilized renewable energy technologies. For additional information on application deadlines and submission details, see page 19239 of the March 31 Federal Register .

Domestic Fertilizer Production

Since the start of the Biden-Harris Administration, USDA has invested more than $174 million through the Fertilizer Production Expansion Program (FPEP) to support 42 projects nationwide to boost domestic fertilizer production.

Today, USDA is providing nearly $4 million in FPEP funding to Bluestem Systems to build facilities and purchase equipment at three locations in Iowa and Nebraska. The facilities will help the company make advancements in its innovative process to remove water and pathogens to create a dry fertilizer mix. The project is expected to yield 3,800 tons of dry fertilizer per year and 11,400 tons annually across all three facilities, which will be made available to 1,500 producers.

Through FPEP, USDA provides grants to independent farmers and agricultural business owners to help them produce fertilizer. Funds can be used to modernize equipment, adopt new technologies, build fertilizer production plants and more. This program helps boost domestic fertilizer production while lowering costs and creating new income streams for U.S. farmers.

USDA Rural Development provides loans and grants to help expand economic opportunities, create jobs and improve the quality of life for millions of Americans in rural areas. This assistance supports infrastructure improvements; business development; housing; community facilities such as schools, public safety and health care; and high-speed internet access in rural, tribal and high-poverty areas. Visit the Rural Data Gateway to learn how and where these investments are impacting rural America. To subscribe to USDA Rural Development updates, visit the GovDelivery Subscriber Page .

USDA touches the lives of all Americans each day in so many positive ways. Under the Biden-Harris Administration, USDA is transforming America’s food system with a greater focus on more resilient local and regional food production, fairer markets for all producers, ensuring access to safe, healthy and nutritious food in all communities, building new markets and streams of income for farmers and producers using climate-smart food and forestry practices, making historic investments in infrastructure and clean energy capabilities in rural America, and committing to equity across the Department by removing systemic barriers and building a workforce more representative of America. To learn more, visit .

USDA is an equal opportunity provider, employer, and lender.


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    To understand the process of developing an investment thesis (different roles, who is involved, what resources are needed) 3. To start to build a perspective on a specific sector as an early stage (Seed / Series A) investor ... Fresco Education Fund, Alice App, and Cariclub. Module overview Assignments (due before class) 1 Components of an ...

  10. Why and How to Build Your Investment Thesis

    An investment thesis applies to any form of investing, from the stock market to horse racing… as long as it involves putting your money behind a principled decision. ... Education is rule number one when coming up with a strategy. It's important to fully understand the ecosystem you're interested in, from the perspectives of both the ...

  11. VC Lab: VC Investment Thesis Template

    A Thesis states the intention of a firm to pursue certain kinds of investments, but often is not legally binding in the firm or in the fund agreements. So, an Investment Thesis has the effect of gravity. Venture capitalists often can do deals that are far away from the Thesis, but they have less attraction.

  12. How to Write an Investment Thesis

    Why home improvement is "one of the most obvious long-term trends out there." Travel and return-to-work are two trends worth watching. Then, using language-learning app Duolingo ( DUOL -1.50%) as ...

  13. How to Write Your Investment Thesis: A Comprehensive Guide

    This phase involves two crucial steps: 1. Pitch to Investors: The Art of Persuasion. Pitch your refined investment thesis to potential investors. The market testing phase would have prepared you ...

  14. How to Write the Perfect Investment Thesis

    Step 2: Conducting Market Research. An investment thesis that is not backed by data is just opinion. To write the perfect investment thesis you need to conduct market research. This includes analyzing market trends, identifying potential risks and benefits, and conducting competitive analysis.

  15. Investment Thesis: An Argument in Support of Investing Decisions

    An investment thesis is a well-reasoned argument that supports a specific investment decision, playing a vital role in the strategic planning process for individual investors and businesses alike. ... This could include objectives such as saving for retirement, funding a child's college education, or purchasing a home. Clear investment goals ...

  16. How to Create Your Investment Thesis

    Below are a few tips to developing your own investment thesis presentation: 1. Pick an industry. When I first considered pursuing VC, I had no idea where to start or what industry to focus on. I ...

  17. Find Better Businesses with a Solid Investment Thesis

    An investment thesis helps investors evaluate investment ideas, ideally guiding them in selecting the best ideas in order to meet their investment objectives. It is a systematic mandate that helps to remove subjective opinions and emotions from the analysis of a deal, as well as quickly screen opportunities and separate the signal from the noise.

  18. Rethink Education's Investment Theses, 2021 Edition

    Rethink First and Guild Education both help employers to offer their employees a free or subsidized educational service as a benefit [note: Rethink First is an operating business no longer ...

  19. Investment Thesis Template

    Create your own investment thesis slide with this free template. This template allows you to create your own investment thesis slide detailing your overall strategy. The template is plug-and-play, and you can enter your own text or numbers. The template also includes other slide pages for other elements of a financial model presentation.

  20. Education as an Investment in Human Capital

    Childbirth and Prenatal Issues. Along with economic and cultural benefits, higher education levels bring major long-term. (murder, rape, etc.) by 30%; reduce motor vehicle theft by 20%; and reduce ...

  21. What is educational investment? (article)

    Educational investment. Educational investment is all about how much time, money, and effort you and your family put into getting a higher education. People choose to invest in education for different reasons, like personal growth, getting a better job, moving up in the world, or helping their community. Everyone has different goals, so what's ...

  22. Keep more of what you earn through tax-efficient investing

    Attractive yet tax-inefficient investments—like an actively managed mutual fund with higher turnover—can be held inside a tax-advantaged account, so dividend or short-term capital gains payouts can remain sheltered. In short, a little investor education on tax treatment can go a long way toward generating better after-tax portfolio returns.

  23. When To Cash In On Your Winners

    The investment thesis is the narrative, the story that explains why I bought the stock in the first place. It explains what I found compelling about the company and why I'd want to hold its stock ...

  24. How Investment In Education R&D By Texas Policy Leaders Could Spur

    By investing in education R&D, Texas policy leaders could help the state build an abundant pipeline of future engineers, teachers, technologists, and business leaders.

  25. Yolo Investments backs TON in widespread $8m investment

    Yolo Investments, the venture capital firm focused on gaming, fintech, blockchain, and emerging technologies, has joined The Open Network (TON) with an $8M USD investment both in Toncoin and across the TON ecosystem.. TON Backing and Partnership Yolo Investments has invested in several TON start-ups, including Tonstarter, Fanton and PlayDeck (formerly known as Ton Play).

  26. Office of Graduate Education and Life announces Three-Minute Thesis

    Paige Zalman, Higher Education, College of Applied Human Services Grand finale prizes include $1,000 for first place, $750 for second place, $500 for third place and $250 for the People's Choice Award. Find more information on the 3MT competition. For questions, contact Betty Mei at [email protected].

  27. IOE alumni named winners of the 2024 BERA Master's Dissertation ...

    Dr Emily Macleod (PhD) and Kate Fox (Education and International Development MA) have won the British Educational Research Association (BERA) Doctoral and Master's Thesis prizes respectively. The awards are given in recognition of academic excellence and research rigour within the field of educational research.

  28. The Bridge: Translation From, For and To April 12 & April 13, 2024

    A diverse and inclusive intellectual community is critical to an exceptional education, scholarly innovation, and human creativity. The Faculty of Arts and Sciences is committed to actions and investments that foster welcoming environments where everyone feels empowered to achieve their greatest potential for learning, teaching, researching, and creating.

  29. Biden-Harris Administration Invests in Clean Energy and ...

    These investments will cut energy costs for farmers and ag producers that can instead be used to create jobs and new revenue streams for people in their communities. For example: In Nebraska, Darr Grain will install three 15-kilowatt (kW) wind turbines at a grain storage facility. This project is expected to save the business $9,700 in ...