By Patric Hellermann
Surviving in nature is a lot like venture capital. There are buffaloes, moving in herds across familiar plains, finding safety in numbers, and competing in often-depleted grounds, while investors move in predictable patterns, following well-worn paths in search of unicorns, with FOMO driving decisions over conviction.
Meanwhile, the solitary polar bear traverses territories others consider uninhabitable, discovering abundant fishing spots. Their hunting brings specialized repetitive knowledge, allowing them to spot value where herds cannot.
After years in venture capital, I’ve noticed that you need a polar bear mentality to thrive in venture. Legendary companies don’t repeat patterns — they create new ones. The best opportunities are hidden from outsiders. Innovation requires the courage to be uncomfortably right when everyone else is comfortably wrong.
Herd comforts
I’ve occasionally acted like a buffalo. It’s easy to follow the crowd, backing the n-th startup in the same model that raised capital in the past 12 months: A familiar pitch deck, predictable growth metrics patterns and a “proven” market. Yet this isn’t proven — it can be repetition based on flawed (early) signals.
Look at waves of quick commerce startups funded simultaneously or the parade of enterprise carbon accounting platforms. VC runs on herd heuristics rather than fundamental analysis. The focus becomes securing the next, ideally large, funding round from a certain investment firm rather than enabling founders to build something valuable.
That’s why I’ve come to appreciate a particular kind of investment opportunity, which remains invisible to generalist investors yet needed by those working inside an industry: vertical singularities.
Polar bears don’t have a supernatural sense of where the fish are. It’s the routine and repetition in their habitats. It’s the same with vertical singularities, which don’t follow familiar patterns or fit easily comparable business models. When investors say, “you’re too early,” what they really mean is “I don’t have the routine in your market well enough to understand what you think is obvious.”
The construction industry illuminates this problem. McKinsey projections show the sector will reach $22 trillion by 2040 and face critical workforce shortages — 41% in the U.S. by 2031 and 1.5 million in the EU. It operates by different rules and idiosyncrasies: it’s project-based, revenue comes from managing complexity, and failure is fatal, not iterative.
Yet traditional VC tactics and heuristics continue to be forced onto this industry with poor results. What works in other sectors will not by default work, because it is fundamentally different.
Hidden value in plain sight
I love being an early-stage investor. You get to meet founders at their inception and origin and must invest time to understand what isn’t obvious at that point without the privilege of numbers.
Many successful B2B category creators appeared unattractive to mainstream investors during their early years, and today’s most valuable construction tech companies were initially dismissed because they didn’t fit standard VC patterns.
When spotting the vertically singular opportunities, the strongest signal isn’t other investors — it’s how early customers behave, such as target users making purchase decisions with speed or intuitively grasping a solution’s value without extensive education. “Customer velocity” tells you more than any pitch competition or analyst prediction ever could.
The best polar bear investors focus on these early adoption signals. They keep portfolio work with their most experienced team members, listen more than they speak, and aren’t afraid to admit when they don’t know something.
The choice
It’s not easy being a polar bear. Every day in this business we face the same choice: Follow the comfortable path with the herd, go for short-term rewards, or develop the specialized knowledge to venture where others won’t go.
Being different means being willing to look (really terribly) wrong — sometimes for years — before being proven right. It’s believing in your investments that don’t fit into the categories other investors understand, even when they face inevitable adversity.
The next legendary companies won’t come from cloning what worked before. They won’t idle on the plains, easily identifiable with binoculars. The founders behind these businesses will discover vertical singularities and build solutions that initially seem too specialized to matter.
Like the polar bear, these founders — and the investors brave enough to back them — understand that true opportunity lies beyond the trodden paths.
In the wilderness of innovation, I’ve made my choice. I love being a polar bear.
Patric Hellermann is the co-founding general partner of Foundamental, the largest global investor in technology for construction, architecture, engineering, design, renovation, blue-collar, and their supply chains and logistics. Founded in 2019, Foundamental backs ambitious, early-stage founders across the Americas, Asia-Pacific and Europe and was an early investor in several category-defining startups, including Infra.Market, Wiz, Speckle, Enter, Snaptrude, Welcome Homes and Forge.
Illustration: Dom Guzman
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