Ho Nam, co-founder and managing director of Altos Ventures, stated that the essence of equity investment is a third asset class: priced by what it can produce. When people are in a hurry or liquidity is high before value is produced, they can cash out, turning the third class into a second class—priced like gold or cryptocurrencies based on what others are willing to pay. He also categorized the iconic institutions and valuation markups in contemporary venture capital as a second class.

Altos was founded in 1996 by classmates from Stanford Business School in Menlo Park and is now a registered investment advisor managing over $10 billion in assets under regulatory standards, with a portfolio that includes Roblox, Coupang, Toss, and Woowa Brothers. Nam moved to the U.S. from South Korea at the age of nine, holds a degree in engineering from Harvey Mudd and an MBA from Stanford, and has experience with Silicon Graphics, Bain, and Trinity Ventures. After failing to raise new funds for five years post the internet bubble, he went to Omaha to learn from Buffett, transforming the institution from a "passive investor for frontline funds" to one that accompanies founders throughout their lifecycle.

The fund's first check typically represents about 5% of the fund, and after gaining confidence, they may increase investment through cross-funds or special vehicles, with follow-up investments potentially reaching 10 to 100 times the initial check; there was a project that saw a 211-fold increase in share price after twelve years. Nam stated that innovation does not follow a financing calendar, and when the intervals between rounds shorten, the belief in the next round can easily become an illusion. The strategy is to invest less but deeper, focusing on hedgehog-type founders, and to strive for self-sustaining growth rather than preparing for brand markups for the next round.

Those buying are long-term investors willing to lock in terms for output, while those selling treat shares as tradable chips in a fast turnover fund. During high liquidity cycles, funds flow from operational equity to iconic rounds and secondary markups. Beneficiaries are funds that can run with cross-period capital and a few companies that are marked up, while those under pressure are investors who treat logos as due diligence and crypto-style valuations as equity.

He emphasized that many third-class investments will slide into second-class during periods of excess liquidity. Altos operates simultaneously in Silicon Valley and Seoul, without pursuing asset management scale as its main business.

Source: Public Information