How you invest your time is just as important as how you invest your money


One night, a policeman does his typical evening walk in the neighborhood. The sun has set and he is on high alert for possible danger as he slowly strolls down the street. He soon encounters a professionally dressed man frantically pacing under a street lamp, occasionally dropping to his knees to peer between the cracks of the sidewalk.

He desperately offers $100 to any passerby who can help him find his lost keys. Relieved to see the police, he asks the police for help, explaining that he urgently needs to go home to his family. Together they search every inch of the sidewalk, gutter and road under the light and come back empty. Everyone they’ve asked for help similarly gives up after finding nothing under the street lamp.

Frustrated and disappointed, the agent finally asks, “Well sir, are you sure you lost them here? Could they be somewhere else?

The man replies, “Well no, I actually lost them in the park across the street, but the light is better here.”

This story summarizes a concept commonly known as the streetlight effect. Its origins can be traced back to a thirteenth-century Turkish parable, but the concept has been repeated throughout history in everything from jokes about people losing their keys to scientific explanations of observer bias in which observers only see what they expect to see . The thing is, you can spend a lot of time looking for something, but if you look in the wrong places, you’ll never find it.

Unfortunately, no one told me this story in my early days of venture capital, so I immediately went looking for deal flow where it was easiest: in Hong Kong. I had a strong personal network and brand in the Hong Kong region, and I had no trouble finding local entrepreneurs willing to pitch Fresco Capital for funding. I spent my days meeting new companies willing to come to my favorite coffee shop on Hollywood Road in Hong Kong, although these weren’t the companies I was most excited about or thought most likely to would be hugely successful. I soon found myself with an extremely packed schedule, but little excitement about any future investments.

At the end of each week I sat back and wondered where the time had gone. I started to realize that I had nothing to see for my full schedule.

You can spend a lot of time looking for something, but if you look in the wrong places, you’ll never find it.

Invest time in places where there is a high concentration of what you are looking for

I had invested my time in meeting with local entrepreneurs, a strategy that did not yield results. There was clearly a light shining straight ahead of me in Hong Kong, but I felt like my keys were somewhere across the street in a park. I knew I had to stop doing what was easy and look beyond Hong Kong for deal flow. Together with my business partner, I began to spend my time researching the major hubs of entrepreneurial and technical activity with a high concentration of entrepreneurs looking for funding. I also hunted those who had made big gains over the past decade (unlike Hong Kong, which was still in its infancy as a startup ecosystem and didn’t have as many examples of successful venture-backed companies). Then I hit the road.

My partner and I spent time in cities like San Francisco, Austin, and New York, as well as London, Beijing, and Singapore. I spent most of my first five years in venture capital on a plane (usually in middle seats in economics, to be exact). On each trip I was energized by the entrepreneurial spirit in each region we visited and was blown away by the number of promising companies we encountered in each place. My days were as packed, if not more, than my time at home. However, unlike my experience in Hong Kong, meeting every day presented exciting investment opportunities that I was eager to dive into. Time flew by and I finally got results. I had a real flow! I just had to get on a plane to go and get it.

As a new small fund, we had a small budget, so I’d plop down on friends’ couches or stay in cheap Airbnbs while I was traveling. Especially when it came to navigating the San Francisco Bay Area, I couldn’t have felt more like an outsider. Who knew that Google’s headquarters in Mountain View was at least an hour from downtown San Francisco, and that that distance increased to several hours during rush hour, which in California did not begin at 5 p.m. as one would normally expect, but in instead at 3 or 4 am. p.m? On one trip, hoping to cut commute times, I chose to stay halfway between my meetings and spend money on a budget motel in Daly City. I arrived, suitcase in hand, to find that the hotel was directly across the street from a junkyard filled exclusively with old school desks, and that Daly City was affectionately referred to as “Daly Shitty” by the locals.

It certainly wasn’t exactly what I originally envisioned once I was on the other side of the investment table, but it was fun and stimulating to chase opportunities, to find the diamond in the rough or the next big thing. We were raising our fund at the same time, so when we made an investment, it was a very small amount. However, we invested a lot of our time developing new sources of deal flow.