Investing Beyond the Obvious: ‘Elsewhere’ in Capital-Deficit Markets and Climate Macro Shifts – 0100 Weekly Brief
Hello there!
In venture capital, investors use different frameworks to identify investment opportunities. For some, this means investing elsewhere—outside of the main innovation hubs. For others, it means focusing on macro shifts that are changing how industries operate.
Two recent conversations we had illustrate these approaches:
Shu Nyatta, Founder of Bicycle Capital, outlines an “elsewhere” thesis, investing in growth-stage companies in Latin America and connecting them to global innovation hubs.
Hampus Jakobsson, Co-Founder of Pale Blue Dot, explains a strategy focused on the macro shift of climate change, involving investments in companies that adapt to electrification and sustainability.
What Does “Investing in Elsewhere” Actually Mean?
“Elsewhere” refers to markets where innovation is applied rather than invented. Invention tends to be concentrated in hubs like Silicon Valley, Tel Aviv, and China, but application can happen in any region. Using proven technologies in large, underserved markets can transform entire industries and create value.
Investment between Latin America and Europe remains limited, despite the region's cultural ties. Media reviews over several years indicate that Latin America is underrepresented compared to India, China, or Africa, and when it is featured, coverage often focuses on negative topics (e.g., corruption, inflation).
Investor perceptions can change through returns: some U.S. and Middle Eastern LPs have re-invested in Latin America after seeing profits. In Latin America, capital arriving from abroad tends to favor more mature companies or real estate rather than innovation.
Markets face different risks: in Latin America, currency and political risk are major concerns. In Europe, regulation and risk aversion are key constraints.
The concept of “elsewhere” in this context means applying innovation rather than inventing it: use existing technological trends in markets outside traditional hubs to drive growth and impact.
Key points to consider:
Perceptions of Latin America are shaped more by headlines than by lived experience.
Successful returns attract more investment and shift perception.
Capital flows from Latin America to Europe tend to go into safer asset classes (like real estate) rather than innovation.
Innovation hubs (like Silicon Valley or China) are seen as inventors; many regions can be locations where those inventions are applied.
Growth in undercapitalized markets requires managing risks like currency depreciation and political uncertainty.
Why is Looking at Macro-Shifts Important?
For some investors, the focus is not only on portfolio companies but also on how they engage with limited partners and position themselves in different market environments.
One approach looks at transparency with LPs, treating fundraising as a process of early alignment on expectations. The goal is to avoid misunderstandings and ensure that capital comes from partners who share the fund’s outlook and discipline.
Regional context also shapes strategy. Europe offers strong research and talent, but faces cultural and structural constraints, including complex company structures, unattractive stock option regimes, and restrictive immigration policies. Around four-fifths of some early-stage climate portfolios are invested in Europe; however, scaling requires systems that enable founders to grow without relying on external hubs.
Guidance for fund managers includes:
Define and maintain a clear strategy.
Be transparent with LPs and founders.
Structure funds in line with the manager’s approach and scale.
Avoid pursuing asset growth for its own sake.
Prioritize companies that combine financial performance with a broader social impact.
Current conditions differ from those of the 2019–2022 liquidity period. Higher interest rates have increased fundraising challenges, particularly for emerging managers. This environment favors funds with disciplined operations and long-term commitment, while less consistent participants are expected to exit the market.
What connects Shu and Hampus is the willingness to go where others hesitate:
Shu looks to undercapitalized markets like Brazil or Mexico, where perception often lags behind reality.
Hampus looks to undervalued transitions, such as electrification, where impact and returns converge.
Both share a contrarian edge. As Hampus likes to remind new GPs, resisting the pressure to “drift” and staying clear on your strategy is important in today’s market environment. For Shu, the same discipline applies: alpha comes not from chasing crowded markets, but by being early where others aren’t.
🗓️ Meet Shu Nyatta at 0100 International
At 0100 International, Shu will speak on the panel “The Opportunity Set in AI – Don’t Miss It” alongside investors from VenCap, Antler, and Ventech.
Shu will be joined by Matt Russell (Investment Director, VenCap), Christoph Klink (Partner, Antler), and Stephan Wirries (General Partner, Ventech). Together, the panel will examine how investors are approaching the rapidly evolving AI landscape, identifying where opportunities lie, and how strategies differ across venture capital and private equity.
This is an opportunity to hear directly from one of Latin America’s most experienced growth equity investors on how global capital can be deployed in undercapitalized regions and how innovation from Silicon Valley and China connects to emerging markets.
🌍 Across the Ecosystem | News & Useful Resources for You
We’re not the only ones examining how investors are redefining their focus in today’s market. Beyond traditional hubs and sectors, strategies include investing in growth equity in regions with limited access to capital and investing in structural shifts, such as electrification and the climate transition.
Here’s a spotlight on perspectives that show how geography and macroeconomic changes are shaping new approaches to venture capital and private equity.
📄 Article | Fiscal Dominance and The Unexpected Rise of Emerging Markets
Investor sentiment toward emerging markets has strengthened in 2025 as concerns mount over fiscal dominance in developed economies such as the US, UK, and Japan. Rising debt levels and political pressure on central banks to cut interest rates have eroded confidence in their ability to control inflation, prompting investors to reallocate capital to emerging markets.
Emerging markets offer higher GDP growth rates, younger populations, and more affordable equity valuations compared to developed economies. Debt metrics have also improved, with EM current account deficits narrowing since 2021, while US deficits widened. This year, EM debt funds have seen sustained inflows, and EM equity indices, particularly in Latin America, have outperformed global benchmarks.
🎙️ Podcast | The Myth of the Region, and Why Carta Is Betting on Complexity
Bhavik Vashi, Managing Director at Carta for the APAC and MENA regions, discussed the challenges and opportunities in Southeast Asia’s venture landscape. He argued that “Southeast Asia” is often treated as a single region for convenience, but in practice, it is a fragmented collection of markets with different regulations, languages, and operating environments.
The fragmentation undermines the classic VC “power law” model, as scaling across countries resembles running multiple businesses simultaneously.
🗞️ News | Vireo Ventures Closes €50m Fund for Electrification Tech Amid Climate Tech Downturn
Berlin-based Vireo Ventures has closed its first fund, totaling €50 million, to invest in early-stage companies focused on electrification technologies. The firm, founded by former Innogy Ventures colleagues, targets startups developing software for energy production and consumption, with a particular focus on EV charging solutions.
The fund comes at a time when climate tech fundraising has slowed, with overall investment in the sector down 71% in 2025 compared to previous years. Despite these challenges, the firm sees electrification as a long-term opportunity, estimating that more than $100 trillion will need to be invested globally to reach net-zero targets.