VCIC Insights (27-28 JUL)
Will be writing my notes on the VCIC 27-28 JUL based on my experience. Comparing to last year’s conference, the market trend is definitely focusing more on AI and fintech. Previous years, companies included Property Development. This year, more companies include Space involvement and more players on the digital assets platform. I’ve only attended the 2nd half of Day 1, and 1st half of Day 2 as other segments weren’t relevant to my focus.
Regarding the companies asking for funding, either the IRRs are low compared to its investment risk involved, IRRs are high, but their model doesn’t justify the targeted returns, or their exit strategies are interesting.. Another investment risk is the redemption or cash flow model if the market isn’t going their way. Granted certain companies have an idea on how they plan to allocate their funding, and most are geared toward either purchasing equipment or OPEX, but their forecasts didn’t show how the investors can redeem or profit from their investments, hence, redemption.
As for AI, computing power and energy consumption will remain as the key factors. Per AI, the vast majority of AI data centers operate on the ground, but underwater data centers are now fully operational, and space-based data centers are actively moving from concepts to initial orbital tests. Electricity isn’t cheap in Australia. As for AI tokenization, my understanding is that the AI tokens aren’t cheap either, especially through Claude. If Claude is going to dominate the AI market, then tokenization needs to be cheaper for us consumers somehow, unless their target is specifically on B2B. Claude may have better utilization on their workflows when building AI agents, but for the personal consumer purposes, for now, I’ll stick with Copilot. Another issue that was addressed is when AI Agents interact with another AI Agent doing B2B transactions. I’m sure utilizing an AI Agent in a digital asset platform one day will be common.
As for Asset and Fund Managers, based on their snapshot of their portfolio allocation models, some have reduced the Property asset allocation. Gold still remains as an allocated asset. Their conviction of their strategies are still under 10%, so why should private credit investors like us assume this risk? Why not just invest in an ETF or a LIC if we want active management?
