Lux Capital's Josh Wolfe Reveals Top 3 Edge Sources for Entrepreneurs and investors #deeptech

When you are an entrepreneur or an investor in venture, there are three sources of edge that you can have. It's really important to understand these, because the third one is the most important. These three edges are:

Informational Edge
An informational edge means that you have access to information that other people don’t have. In today's world, this is really hard to achieve because information is abundant and flows everywhere. Information wants to be free in the proverbial sense, and everyone has access to it.

Analytical Edge
An analytical edge refers to your ability to analyze the same information differently than others. For example, I may receive a piece of information that my partner also has, but I might interpret or analyze it in a way that is distinct from her perspective. Maybe I’m right, maybe I’m wrong. This is difficult because there are brilliant people everywhere, and now we’re all augmented by AI. So, it’s hard to have a better analysis than someone else.

Behavioral Edge
The third edge is a behavioral edge, and it’s the most powerful and lasting one. This edge is about identifying where the herd is going and doing the opposite. It’s about having the ability to predict trends or spot opportunities that others overlook.

For example, in the past, everyone in the venture world was focusing on cleantech, including biofuels, solar, and ethanol. But at that time, we decided to look in the other direction. If you, as an entrepreneur, can identify what the herd is doing and then find a different, yet viable, path — and be right — that’s extremely powerful.

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