Thursday November 10, 2016
BOSTON, MA – Matthew Stack, founder of the Stack Family Office and a co-founder of XLP Capital, presented at the Opal Financial Group’s Family Office and Private Wealth Management Forum – West held in Napa, CA on October 28-30. Designed as a meeting ground for some of the most prominent business families in the U.S., Opal Financial Group’s Family Office and Private Wealth Management Conference series focus on investment trends, opportunities, and collaboration among attendees. On a panel titled “Investing in Technology,” Mr. Stack discussed his extensive experience as an angel and early stage investor in prominent technology companies in the early 2000s. His comprehensive overview of the current state of the private market in technology included discussing its cyclical nature, and his conviction that the technology industry is in a bubble. According to Mr. Stack “angel investing was profitable 10 years ago. Right now, the only way to make wise investments in technology is either through vigorous internal due diligence on the venture side, or through shorts on the public side. We don’t invest in anything that has a website or an app.”
Mr. Stack explained XLP Capital’s view that technology companies are overvalued. Unicorns are meant to be rare, maybe even unheard of, yet FY2015 alone has seen the emergence of more venture-funded companies with pre-IPO valuations >$1 billion than the previous several years combined. Mr. Stack, and the investment team at XLP Capital, believe that such valuations are unsustainable and stultifying to public and private funds. Overvaluation of startups practically bars investor exits. The prospect of several multiples on investment that used to characterize the return on venture investing is gone. Nevertheless, unicorns have become abundant. Due to his beliefs of the unsustainability of technology startup valuations, Mr. Stack confessed his nickname “the unicorn hunter,” creating a moment of shared amusement among attendees.
XLP Capital announced the acquisition of the Lambda Prime venture fund and incubator late this summer. Lambda Prime is dedicated to the under-served technology investment gap created by the over-growth of traditional venture funds and the commoditization of web and IT investing. The firm’s philosophy centers on applying ever more novel mathematical approaches and algorithms across industries. Lambda Prime invests resources and capital, but more importantly, provides a platform of computational and proprietary data sets only available to in-house portfolio companies. Through Lambda Prime, XLP Capital is an active investor, one recent find is Haystack Technologies – an “internet of things” company that holds invaluable IP in the space.
About XLP Capital
XLP Capital is a technology development, venture investment, and strategy advisory firm. Headquartered in Boston, MA with offices in New York, NY, the DC-metro area, and the Berkshires, XLP takes an engineering-based, hands-on approach to strategic technology investment and advisory work. For XLP, management science means a hands-on, deal-driven approach to technology investment. Whether via the application of high-throughput computational science techniques, rapid prototyping or advanced technology landscaping and analytics, XLP focuses on creating value and wealth. These investments take multiple forms, including venture investing, shareholder activism and corporate innovation programs. For more information, please visit www.xlpcapital.com or contact us at email@example.com
XLP Capital is a family office and as such is not required to be registered as an investment adviser with the U.S. Securities and Exchange Commission. Investments are made available only to accredited, qualified, or institutional investors that are eligible as family office clients, pursuant to the rules of the U.S. Investment Advisors Act of 1940. XLP does not seek or solicit investment for these funds or any other funds, and nothing on this page should constitute a solicitation for investment. The descriptions on this page is provided for information value only, as examples of prior investment related work XLP has conducted. XLP Capital assumes no liability for investment losses direct and indirectly resulting from recommendations made, implied, or inferred by its research. Likewise, XLP Capital assumes no claim to investment gains direct or indirectly resulting from trading profits, investment management or advisory fees obtained by following investment recommendations made, implied, or inferred by its research. Investment involves risk, and all investments should be made with the supervision of a professional investment manager or advisor. The materials on the Website are not an offer to sell or a solicitation of an offer to buy any investment, security or commodity, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.