Interview With Andres Azcarraga
NameAndres Azcarraga Rivera Torres
Fund / GroupYaaX Capital
Number of portfolio companiesYaax Capital I - 23
Yaax Capital II - 3 now, ~20 expected
Focus GeographiesMainly: USA, Europe, Mexico and LATAM.
Stage(s)Seed to Series B, Public
John Farrell & Andres Azcarraga Rivera Torres
Associate: Sean Tillery
Senior Analyst: Alejandro Gil
Investor Relations Analyst: Renata Bernot
HOW AND WHY DID YOU GET STARTED IN PRIVATE INVESTING?
I've always been interested in innovation and novel technologies, I guess that is what brought me to Venture Capital back in 2015. Innovation and technology were key for me in any business (old and new), as I was thinking in new ideas for our family business in old industries like Real Estate and Media.
WHAT IS THE SINGLE MOST IMPORTANT THING YOU VALUE IN AN INVESTMENT OPPORTUNITY?
The team. For us at YaaX, teams are the most valuable asset a company can have. When push comes to shove, good teams will pivot and turn the story around, they will raise the capital needed and most importantly, good teams get the job done and execute.
WHAT ARE THE BEST INNOVATION THEMES THAT YOU SEE IN THE MARKET TODAY?
Good question. For me, it's a divided answer. On one side, the obvious innovations like AI, a Virtual Universe, Climate Change Tech, Space Travel, so on and so forth…. On the other hand, we see old school industries like Cannabis and Psychedelics innovating the legal frameworks in our adult lives one more time.
BEYOND ECONOMIC RETURN, WHAT KIND OF IMPACT DO YOU HOPE TO MAKE WITH YOUR PORTFOLIO?
Beyond economic return, I believe YaaX will have a huge impact worldwide. I would dare to say, many people out there don't know the capabilities of the cannabis plant for itself. From a cannabis product, to a medicine treating epilepsy for children and cancer to clothes (hemp substituting for cotton). All under the same plant. It's fascinating - I imagine what could be done with more research and less regulations.
WHAT ARE THE MOST PRESSING CHALLENGES OR PAIN POINTS IN MANAGING YOUR DAY-TO-DAY PRIVATE INVESTMENT ACTIVITY?
Regarding YaaX internally, dealing with LPs and having a good relationship with them is the most important challenge and opportunity as well. It's also important to have great teamwork and constructive interference. Constructive interference is defined as- the interference of two or more waves of equal frequency and phase, resulting in their mutual reinforcement and producing a single amplitude equal to the sum of the amplitudes of the individual waves.
Regarding YaaX externally, the biggest challenge for us is dealing with government regulators and their timelines. Cannabis businesses are growing exceptionally well YoY, however, they lack institutional capital and access on top US public exchanges due. This presents a unique investment opportunity for YaaX.
WHAT IS THE HARDEST INVESTMENT LESSON YOU'VE LEARNED AND/OR THE BIGGEST INVESTMENT MISTAKE YOU'VE MADE?
The biggest investment mistake I have ever made was our first investment with YaaX I. The market was frothy, and we decided to go for a very large Canadian LP that later IPO'ed on NASDAQ a year later, then tanked on the burst of the first cannabis bubble. Several lessons learned here.
WHAT ARE YOUR FAVORITE INDUSTRY INFORMATION SOURCES AND/OR SERVICES?
Pitchbook and Crunchbase for VC and PE. Jane, of course for the cannabis industry.
WHAT'S YOUR FAVORITE NON-BUSINESS INTEREST OR HOBBY?
Showjumping. I compete professionally and I have represented my country in several individual and team competitions around the world.
PLEASE LEAVE US A BOOK RECOMMENDATION (BUSINESS OR OTHERWISE).
Stealing Fire by Steven Kotler
WHAT'S YOUR TAKE ON THE PRIVATE MARKET OVERALL?
I would go with a 7. . . When there is a crisis, there is opportunities for those with cash on hand. The risk reward profile on cannabis have never been better with multiples being where they are. Yaax Capital is fundraising and deploying Yaax II, given early traction with YaaX I.