PE Risk + VC Upside = The 'Racehorse' Investment Thesis

For too long, investors have been told they have to choose: the binary risks of VC or the moderate returns of PE. But a powerful hybrid model exists.

This is the 'Racehorse' thesis. We define a 'Racehorse' as a mature company with a proven product and existing sales. The key is to invest right at their growth inflection point. By doing so, you bypass the early-stage mortality risk where most startups fail, fundamentally lowering the risk profile of each investment.

This lower-risk approach significantly increases the percentage of companies in the portfolio that can reach a successful exit.

This isn't just a theory—it's validated by the market. A look at the Israeli tech ecosystem (2022-2024) is telling:

🦄 Unicorn Exits ($1B+): 5

🐎 'Racehorse' Exits ($200M-$1B): 40

This 8-to-1 ratio highlights a unique situation in Israel today. A mature ecosystem and recent valuation corrections have created fertile ground for these 'Racehorse' opportunities.

Ultimately, this strategy is about taking the best of both worlds: the downside protection and discipline of Private Equity, combined with the exponential growth potential of Venture Capital.

It’s a disciplined approach for delivering top-tier returns. Would love to hear your thoughts.