CB Insights have published great research into Sir Richard Branson’s investment habits.Although, says the research company, his Virgin Group is made up of more than 400 companies, Branson still finds the time to actively invest in startups. Since 2010, Branson has funded 17 startups across a wide mix of industries: consumer products (such as cycling startup Smidsy), biotech (Solazyme) and other sectors (such as a crowdfunding platform, a Bitcoin startup and others).
What is striking from the research is that of all of Branson’s investments, more than half (59 per cent) have been made this year already ? the most he’s done in any year so far (see chart above). He does not always invest on his own: “While Branson counts investments in a diverse group of startups, he actually tends to invest or follow-on with a select group of VC investors more than others,” says the research. As CB Insights’ Business Social Graph visualisation shows (below ? click to expand), those VCs are Kleiner Perkins Caufield & Byers, Union Square Ventures and London VC Index Ventures, which has co-invested with Branson in five separate companies, including Transferwise, BitPay and Codeacademy.
What can we garner from this information? First, that Branson is confident in the economy: now is the right time to invest, just as things are picking up. Second, that not all VCs are created equal: Branson clearly prefers working with certain VC firms over others (it isn’t a coincidence that he’s invested five times with Index). Finally, the key to a successful investment strategy is diversification. Branson doesn’t put all of his eggs in one basket. While it may look like his investment strategy is all over (investing in Bitcoin startups and consumer product companies), he’s just hedging his bets, as any sensible investor should do.
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