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What Do LPs Think of the Venture Capital Markets for 2016?

Both Sides of the Table

At the Upfront Summit in early February, we had a chance to have many off-the-record conversations with Limited Partners (LPs) who fund Venture Capital (VC) funds about their views of the market. In fact, if you add the capital flows of the past ten years, there have been just shy of $50 billion in net cash outlays.

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What’s Really Going on in the VC Industry? What Does it Mean for Startups?

Both Sides of the Table

Consumers pulled their money out of these risky investments, but when LPs make commitments to VC funds they make 10-year, legally binding commitments. So as of 2008 total LP commitments were still at nearly $250 billion. You’ll notice that Harvard lost 30% of the entire value of its portfolio.

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Two Portfolio Tips for First Time Seed Funds

Hunter Walker

That said, there are two portfolio modeling/management tips that I do think are valuable exercises for every Fund I. If Your Portfolio Model Assumes Outperformance Across Multiple Metrics, I Don’t Believe It: Every VC fundraise has an Excel sheet that forecasts the performance of the fund.

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What Makes an Entrepreneur? Cojones (7/11)

Both Sides of the Table

If your idea is so amazing that it warrants my hard-earned angel money or the money of my LP investors from our fund then why should I take a risk on you if you won’t take a risk on yourself? Partners in VC funds only wanted to fund entrepreneurs who had a certain percentage of their net worth tied up in their venture. Why should I be?

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IRR is a vanity metric

VC Adventure

In markets like this, funds that deploy quickly generate markups on their full portfolio; those that show more patience suffer from an IRR perspective as a larger portion of their fund is yet to be marked up by subsequent financing rounds. Traditionally LPs have viewed this as positive. management fee).

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15 Steps to Fundraising for Your New Venture Capital or Private Equity Fund

David Teten

For example, one LP told me she prefers customized emails from fund principals, as opposed to a bulk-mailed quarterly update. Conduct an honest self-evaluation: can you realistically raise money from institutional investors, or should you focus on high net worths/family offices? We are using Digify to manage this.

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What Everyone Should Take Away from Twitter’s 8% Staff Reductions

Both Sides of the Table

I spoke at Michael Kim’s excellent annual Cendana VC/LP conference today. Today I called it, “our own little VC led, portfolio-by-portfolio company version of RIP Good Times from 7 years ago.” ” It goes like this: What is your net burn rate? Here’s my take away. What is your cash balance?

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