“No growth happens when it's easy. The fun happens in the friction, and the friction is an opportunity to get out ahead of competition. It's an opportunity to demonstrate collaboration and camaraderie and capability as a team. That’s the good stuff.”

- Seth Winterroth

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ABOUT THIS EPISODE

What does the thesis development process look like for deep tech investments? This is a question that venture firms like Eclipse Ventures actively consider. Eclipse Ventures is a VC firm that partners with exceptional entrepreneurs to redefine physical industries through deep tech innovation. Seth Winterroth, a Partner at Eclipse, brings nine years of venture capital experience, having previously worked at GE Ventures.

In a recent episode of Boost VC, Seth shares insights into how Eclipse approaches investments in emerging technologies and develops their investment thesis. Eclipse focuses on small teams of engineers who solve complex development problems, with a particular emphasis on industries operating in the physical world, which constitutes around 80% of global GDP.

When it comes to investing in emerging technology, Seth advises starting with market analysis and identifying customer pain points. Eclipse seeks out specialists who can develop unique solutions tailored to specific needs. They also add traditional engineers with experience in scaling technology to ensure successful implementation.

Seth's interest in robotics was sparked by Amazon's acquisition of Kiva Systems, which highlighted the market trends driving the adoption of autonomous systems. His first investment at Eclipse was in 6 River Systems, a robotics company in supply chain logistics. The success of this investment was evident when Shopify acquired 6 River Systems for $500 million in 2019.

Identifying investment opportunities involves assessing team profiles, product differentiation, and identifying gaps in the market. Eclipse engages with customers and leverages internal engineering expertise to ensure their investments align with market demand and address existing gaps.

One valuable piece of advice Seth shares with young VCs is the importance of cultivating patience and maintaining a rational mindset. In a chaotic and unpredictable industry, it is crucial to respond calmly and devoid of fear. By engaging with founders in a rational manner, VCs can foster strong relationships built on trust and collaboration.

Eclipse Ventures' approach to investments in deep technology encompasses various key elements. Their diligence process involves thorough evaluation of emerging technologies, such as robotics, autonomous systems, computer vision, and machine learning. This ensures that they invest in companies that are at the forefront of technological advancements.

Engineering expertise is a vital component of their investment thesis. Eclipse looks for small teams of engineers who can solve complex development problems and possess experience in scaling technology. By combining specialist knowledge and engineering acumen, Eclipse Ventures can build companies that drive innovation in physical industries.

As a venture firm, Eclipse Ventures embraces the dynamic nature of the technology ecosystem. They actively seek out startups and entrepreneurs who are leveraging deep tech to disrupt traditional industries and create new opportunities. By partnering with exceptional founders, Eclipse Ventures becomes a supportive investor and shareholder, providing value-added capital beyond just financial resources