Notable Capital’s Hans Tung on why founders need to play the long game

Hans Tung discusses long-term VC strategies, AI investment hype, and fintech's potential despite recent funding lows.

: Hans Tung, managing partner at Notable Capital, emphasizes the importance of long-term thinking in venture capital and how temporary valuation changes are less critical than achieving substantial outcomes. He acknowledges the current overvaluation in AI investments but remains bullish on fintech, citing its growth potential despite a recent drop in funding to a seven-year low. Tung also touches on the challenges VC firms face due to past investment strategies, affecting their ability to invest actively now.

Hans Tung, a seasoned venture capitalist at Notable Capital, formerly GGV Capital, brings insights into the evolving dynamics of the VC industry, particularly focusing on the significance of enduring strategies over short-lived valuation surges. With a backdrop of extensive experience from successful investments in companies like Affirm and Airbnb, Tung articulates the necessity for founders and investors to adopt a long-term perspective, especially during fluctuating market valuations. He rationalizes down rounds as strategic steps towards sustainable growth, rather than setbacks, emphasizing that genuine success is measured by long-term achievements rather than immediate market reactions.

Despite the hype surrounding AI, with significant overvaluations marking early investment rounds, Tung advises founders to concentrate on business fundamentals. He mirrors this sentiment in his views on fintech, expressing optimism for the sector's future despite a temporary slump in investment. By highlighting the minimal market cap penetration by fintech firms compared to the broader financial services industry, Tung underscores a substantial growth corridor for fintech, suggesting that patient and strategic investments in this domain could yield considerable returns.

Tung also comments on the broader VC ecosystem's adjustments to a slower investment pace, attributing this shift to the overzealous funding activities of 2021. He points out the repercussions of such past strategies, including reduced liquidity and investment capacity among some VC firms. This scenario underscores the importance of prudent investment strategies that can withstand market volatilities, reinforcing the value of long-term planning and flexibility in navigating the ever-changing landscapes of venture capital and technological innovation.