Investor Discussion Series: Niko Bonatsos of General Catalyst

Niko Bonatsos is a managaing director and former entrepreneur at General Catalyst.

What Trends are you currently investing in, especially any that are more under the radar?

At General Catalyst we are generalist investors looking to be inspired by ridiculously ambitious entrepreneurs.  Lately I’ve been spending a lot of time on Augmented Reality and Virtual Reality.  VR is better than ever but still early.  I’m also spending a lot of time in the crypto space.   Other areas I’m interested in investing around include the end of life space which includes life insurance, finding caregivers, setting up wills, etc.   Another non-sexy area I am looking to invest is the medical tourism industry such as a booking.com for medical tourism.  This is a huge space that is not yet followed by the mainstream.

You’ve written a bit and invested around augmented reality.   What do you think of Augmented Reality right now?

AR is still in its early days with the platforms having a vested interest to push it hard which you are seeing as all mobile devices became AR capable.  Pokemon Go’s success was a great example of the potential of the space. 

There are also very interesting enterprise use cases for mobile first AR products such as collaboration, technician help applications, etc.  We are also seeing a lot of high quality talent coming into the space.  Even more importantly some enterprise focused AR plays are starting to make money so this is really happening right now.  Recently I invested in 6D.ai, platform as a service that is solving data persistency and building the ARcloud. 

Gaming will be the first killer application on this platform.  Houzz recently did a study on an AR feature in their product that showed when customers use the AR feature they would spend a lot more money.  AR will also be a boon to eCommerce.

What are some resources you use to stay up to date on the space?

I read a lot of stuff.  I also get to meet a lot of super high quality people including angel investors, executives, and entrepreneurs.  I then simply put in the hours to learn the space. 

Any advice to young venture capitalists and angel investors out there in sourcing deals?

●      Assume you will lose all your $ when you invest as an angel - only invest what you can afford to lose.

●      Come up with a mental framework (e.g. I only invest in people that I’d start a company with, etc.) of what type of opportunities you want to invest in.

●      As an angel investor the stuff you think will do well won’t do well and the stuff you think won’t do well will do well. 

●      Double down on stuff you are very certain will work out very well.

Any predictions for 2018-2019?

There will be a VR company with a million daily active users.  At least 3 or 4 more Pokemon Go types of companies that are AR enabled.  There will emerge a second killer app for crypto (beyond digital money) with crypto scaling so people can build off of them as platforms.