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In this article we will take a look at Balaji Srinivasan's top 10 investments, portfolio and ideas. You can skip our detailed analysis of these companies and go directly to the Balaji Srinivasan's Top 5 Investments, Portfolio and Ideas.
In late January 2020, an entrepreneur sounded the alarm about the coronavirus spreading across the world. In a series of tweets, Balaji Srinivasan underlined the severity of the threat emerging from the Chinese city of Wuhan and assailed the American media for downplaying the urgency of the matter. Already known for his provocative views in the business world, few were prepared to take him seriously when it came to virology. His worst fears realized, Srinivasan stood vindicated a few weeks later as the virus wreaked havoc across the US.
This was not the first time that Srinivasan had offered telling insight into a real-world problem before the experts of the field in question caught on to the idea. In fact, the entrepreneur has developed somewhat of a habit of being right about future trends. He has consistently backed the rise of blockchain, invested in revolutionary genetic research, and foresaw the erosion of authority away from banks towards fintech firms through the course of his as yet short career in the incredibly unpredictable world of venture capital.
Srinivasan holds a doctorate degree in electrical engineering from Stanford University and is a part-time teacher when he is not busy finding companies like Earn, Counsyl, Teleport, and Coin Center. Three of the four startups mentioned above have been bought by bigger companies. Earn was acquired by Coinbase, which is set to go public on April 14; Counsyl was purchased by Myriad Genetics, Inc. (NASDAQ: MYGN), and Teleport was bought by Topia. He is also a former partner at Andreessen Horowitz, a top venture capital firm based in Menlo Park, California.
The investments that the Stanford teacher has made over the years have earned him several accolades. In 2018, Fortune magazine featured him on The Ledger 40 under 40, a list of young venture capitalists who were transforming the world of finance and technology. Srinivasan has also been named on the MIT TR35, a listicle that honors innovators under the age of 35. In 2013, he took an online course that drew more than 250,000 students globally. He also has a Wall Street Journal Innovation Award for Medicine.
Balaji Srinivasan's Investments and Portfolio
The angel investments Srinivasan has made have turned him into a social media celebrity. He often disguises his criticism of authority under themes relating to erosion of trust in experts and the nature of truth in the modern world. Perhaps more than anyone else, the young entrepreneur embodies the disrupting spirit of the young generation towards those in power. He is part of a large group of young venture capitalists who advocate for aggressive investment in new technology which often leave hedge funds vulnerable to market fluctuations.
Individuals like Srinivasan are surely beating the market and staying way ahead of their times with their innovative, out-of-the-box thinking, unlike the conventional hedge fund industry which is struggling to tackle the financial and technological changes. In fact, the entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
With this context in mind, here is a look at the top 10 investments, ideas, and portfolio of angel investor Balaji Srinivasan. We talk about the companies Balaji Srinivasan invested in by taking a look at his portfolio. These investments will give you an insight into the mind of the venture capitalist and also shed some light on the broader areas and sectors he’s bullish towards.
Earn.com was a company founded by Balaji Srinivasan in 2013 that allowed senders to pay users in digital currency for replying to emails and completing tasks. The firm said that the introduction of payments was beneficial to both normal email users and commercial ones. It managed to raise more than $121 million in funding before being acquired by cryptocurrency exchange Coinbase in 2018 in a deal rumored to be worth $100 million. Srinivasan was made Chief Technology Officer of Coinbase after the purchase, a position he left in May 2019.
California-based venture capital firm Andreessen Horowitz, where Srinivasan has been a partner, was one of the lead investors in Earn.com during a Series B funding round. After the purchase of the company by Coinbase, Srinivasan told American media that the deal represented a positive turn on investment for those who had backed the firm as a startup. Since the founding of Earn.com, many companies with the same business philosophy have emerged, including Amazon Mechanical Turk, owned by Amazon.com, Inc. (NASDAQ: AMZN).
Counsyl is a health technology company founded by Balaji Srinivasan in 2008 that was acquired by Myriad Genetics, Inc. (NASDAQ: MYGN) in May 2018 for $375 million. Counsyl had managed to raise more than $237 million in funding before it was acquired by Myriad. New York-based investment bank Goldman Sachs was one of the lead investors in the health technology startup during its early days, according to Crunchbase. Felicis Ventures and Founders Fund also contributed to the startup before its sale.
In a press release, Myriad said that it had acquired Counsyl since it had grown incredibly and was earning more than $130 million in revenue at the time of the purchase, having performed over 280,000 reproductive tests. Myriad wanted to offer the products marketed by Counsyl in conjunction with the ones made by the company to become the leading genetic testing company. The market cap of Myriad is more than $2.1 billion and it posted more than $636 million in revenue in December 2020.
Soylent is a Los Angeles-based food company that markets functional eating products for the body that do not harm the planet. Balaji Srinivasan, as a partner at Andreessen Horowitz, was one of the early backers of the startup, providing it more than $1.5 million in seed funding in 2013. Afterwards, the startup went on to enjoy huge success, managing to raise more than $133 million in funding by 2017 and was valued at up to $500 million at the time. A total of nine investors, including Initialized Capital, backed the firm as a startup.
Last year, the company announced a shakeup in top management, with Bryan Crowley stepping down as CEO to be replaced by Demir Vangelov. Since the founding in 2012, the company had grown by the time Crowley left, as retail giant Walmart Inc. (NYSE: WMT) had a partnership with the firm to sell its products at more than 4,000 stories across the United States. The competitors of Soylent include Huel, Ample V, Sated, Diet Extreme, OWYN, and Runtime. Soylent has been undergoing layoffs of late as it loses market share to competitors.
Ethereum is a Madrid-based firm that uses new community-run technology like blockchain, ether (ETH) and thousands of decentralized applications to offer financial services to users around the world. Srinivasan has backed the cryptocurrency to succeed and also features it on his personal website under the angel/advisory category, indicating that he is an angel investor or advisor in the firm. As the global crypto market hits $2 trillion in market capitalization, Ethereum is one of the most sought-after currencies on the market.
Competitors to Ethereum include Hyperledger, IBM Blockchain Platform, owned by International Business Machines Corporation (NYSE: IBM), Azure Blockchain Workbench, and several others. Ethereum is presently the second-largest crypto on the market, trading at more than $2,100. The recent price boost has increased the market capitalization of Ethereum to $244.4 billion. It also means that the price of Ethereum is up by more than 180% year-to-date – having opened in January at a value of $737.71.
Gencove is a New York-based firm that aims to make gnome data and research more accessible and interpretable around the world. It has a low sequencing platform that delivers genome discovery at the cost of genotyping arrays. Srinivasan has an angel/advisory role in the startup that was founded in 2015 and managed to raise more than $5 million in funding, including more than $1.4 million in the latest round back in March. National Institutes of Health and Spero Ventures are lead investors in the startup.
In January, Michigan-based food safety firm Neogen Corporation (NASDAQ: NEOG) announced that it had made a deal with Gencove to develop the next generation of animal genomic tests. The partnership was based on the ability of Gencove's whole genome sequencing platform, a new kind of technology with the capability to accurately assess the genetic potential of an animal earlier in its life. Srinivasan, who backs this firm, has stoked controversy for saying that the US drug regulators do not let startups innovate.
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Disclosure: None. Balaji Srinivasan's Top 10 Investments, Portfolio and Ideas is originally published on Insider Monkey.