Both Sides of the Table

JULY 16, 2010

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. I was at dinner with a large LP and mentioned that I had heard the industry would shrink by 50%.

LP 311

LP Technical Review Early Stage Silicon Valley 311

David Teten

DECEMBER 3, 2019

Private equity and venture capital investors are copying our sisters in the hedge fund world: we’re trying to automate more of our job. . Tim Friedman, Founder, PE Stack , said, “If I could offer one piece of advice to today’s managers, it would be to take the time to understand the demands of the modern institutional LP.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Feld Thoughts

AUGUST 13, 2018

We feel that if an LP gives us a $1 to invest, we should invest at least that $1, not $0.85 (the average fee load over a decade for a typical VC fund is 15%.) Our goal for each fund is actually to invest closer to 110%, which means if an LP gives us a $1 to invest, we are actually investing $1.10. That’s worth remembering.

LP 117

LP Management Carried Interest .Net 117

View from Seed

OCTOBER 29, 2014

Most folks reading this will know that many startups were built in part with the help of venture capital. A smaller portion of the total capital in the VC ecosystem comes from high net worth individuals. Lee’s posts also appear regularly on View From Seed. Subscribe here for more. What Are These Intermediaries?

LP 335

LP Private Equity Institutional Investors Venture Capital 335

This is going to be BIG.

JULY 30, 2015

One of the first things I did when I joined the venture asset class as a lowly institutional LP analyst in 2001 was to build the VC fund cashflow model. You incorporate expected company returns, mortality rates, and fee structures to try to predict how a venture capital fund works from a cash in, cash out, and NAV standpoint.

Venture Capital 60

Venture Capital Pre-Money Valuation IRR Valuation 60

Genuine VC

OCTOBER 11, 2011

Last September I wrote a post outlining my view of the venture capital industry: increasingly evolving like the beer industry as it continues to mature. All of that choice becomes a double-edged sword for entrepreneurs, but in the end is of course net positive.

Venture Capital 150

Venture Capital Seed Stage Entrepreneur LP 150

Both Sides of the Table

JUNE 8, 2014

Changes in the Software World & in Venture Capital. But notably you had the following changes: Horizontally scalable computing & storage systems, which meant you required less capital up front for hardware. Venture Capital. And then the world changed. Changes in the Startup Ecosystem. We have invested $17.3

Silicon Valley 390

Silicon Valley Kansas City Startup Venture Capital 390

Feld Thoughts

MAY 28, 2014

The advantage, for all the investors (the VCs and their LPs), is that $100m gets put to work as invested capital, rather than just $85m. Our view as a firm is that a successful VC fund has a net return of at least 3x to the LPs. That means that if an LP invests $1 in the fund, they get back $3 over time.

Management 150

Management .Net LP Venture Capital 150

David Teten

JUNE 1, 2011

To maximize value and sale price, wider net is better There is a lot of un-invested capital sitting in funds and outside-in it is hard to tell the internal dynamics, so casting a wide net increases chances of a good outcome. Prestegaard, High Road Capital Parnters. Zubin Avari, Charter Oak Equity LP Christopher A.

Private Equity 122

Private Equity Deal Flow Equity Developer 122

Both Sides of the Table

OCTOBER 14, 2015

I spoke at Michael Kim’s excellent annual Cendana VC/LP conference today. One of the points I tried to make is that as venture capital investors as an industry we seem to have a healthy disdain for public market investors. ” It goes like this: What is your net burn rate? What is your cash balance?

Burn Rate 150

Burn Rate San Francisco Private Equity LP 150

Both Sides of the Table

APRIL 3, 2010

This is part of a series that I’ve been working on called Understanding Venture Capital. As a reminder, VC funds are comprised of money from LP’s (Limited Partners) that include university endowments, pension funds, high-net-worth individuals, insurance companies and large corporations.

Pre-Money Valuation 226

Pre-Money Valuation Venture Capital LP Term Sheet 226

This is going to be BIG.

SEPTEMBER 19, 2012

I've been extremely fortunate to work at two of the best venture capital firms in the country--Union Square Ventures and First Round Capital. Several GA members have made introductions for me to high net worth and family office investor contacts.

LP 112

LP New York City New York Chad 112

The Equity Kicker

JANUARY 19, 2016

7/ Net/Net: VC is a hard f **g business but simplification in press makes it seem glamorous & easy – almost swashbuckling. Fortunately Steve Schlenker, co-founder of DN Capital has captured most of them in his Quora answer to the question: How hard is it to be a venture capitalist. NotGlamorous.

Europe 60

Europe IPO LP Venture Capital 60

Agile VC

NOVEMBER 13, 2012

There are some obvious structural reasons why a shakeout in the venture capital industry takes a long time. The reality is that it wasn’t until the GEC (Global Economic Crisis, Great Recession, Credit Crunch, call it what you will) of late 2008 and early 2009 that the shakeout really began for venture capital.

LP 154

LP Portfolio Venture Capital IRR 154

Babbling VC

JANUARY 7, 2011

I personally believe that one of the major drawbacks to venture capital in Europe is chronic under-financing and people skirt around this issue. Net returns may have been in line as many EU VC's like to argue but the sums going in and coming out paled in comparison to US deals. Unfortunately, all ships do not rise with the tide.

Finance 76

Finance LP Europe Valuation 76

David Teten

AUGUST 21, 2019

Should you raise venture capital from a traditional equity VC or a Revenue-Based Investing VC? Companies Lighter Capital has funded on average have negative 14% net margins.” not because of LP objections or moral concerns, but because the pool of potential M&A buyers is greatly limited.

Revenue 60

Revenue Liquidation Preference Equity Cofounder 60

thebarefootvc

MARCH 8, 2012

While the seed capital gap has closed, there are still only a handful of venture capital firms here in NYC investing in the crucial Series A/B rounds. In contrast, many Silicon Valley funds are large with much capital to put to work (which is why we are seeing them lead NYC deals at these stages).

Silicon Valley 69

Silicon Valley Ghana Venture Capital India 69

Austin Startup

JUNE 26, 2019

So, we worked to raise capital. Turns out my network (of politicos and do-gooders) is not one of accredited tech investors (meaning they meet income and net wealth thresholds and choose to make investments at all, and specifically in startups). Early on we reached out to friends & family. But, this is simply where we’re at, now.

Silicon Valley 54

Silicon Valley Startup B2C Sweat Equity 54

abovethecrowd.com

APRIL 20, 2016

In Silicon Valley boardrooms, where “growth at all costs” had been the mantra for many years, people began to imagine a world where the cost of capital could rise dramatically, and profits could come back in vogue. Competition also has access to capital. Anxiety slowly crept into everyone’s world. 2015 was the exact opposite.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

David Teten

JULY 12, 2017

First, a formal definition: According to Capital Dynamics , “Co-investments are direct investments in a company made alongside and on the same terms as a lead [General Partner]. For further reading: Making Waves: The Cresting Co-Investment Opportunity (Cambridge Associates).

Syndicate 60

Syndicate Syndication Institutional Investors LP 60

K9 Ventures

NOVEMBER 30, 2008

The business of venture capital is relatively young. The birth of modern-day venture capital (not considering the European monarchs financing explorations and projects as venture capital) can be traced back to American Research and Development, which was started by Georges Doriot. The LP perspective.

IRR 48

IRR Venture Capital LP Early Stage 48

K9 Ventures

DECEMBER 10, 2011

Funding environment : No one can question that Silicon Valley has the most developed venture capital and funding environment for startups. There are more venture capital funds, micro-VCs, super-angels, angels and incubators in the valley than probably in the rest of the world combined (exaggerating to make a point).

Silicon Valley 124

Silicon Valley San Jose Portfolio Cofounder 124

K9 Ventures

DECEMBER 10, 2011

Funding environment : No one can question that Silicon Valley has the most developed venture capital and funding environment for startups. There are more venture capital funds, micro-VCs, super-angels, angels and incubators in the valley than probably in the rest of the world combined (exaggerating to make a point).

Silicon Valley 112

Silicon Valley San Jose Portfolio Cofounder 112

This is going to be BIG.

MAY 16, 2016

There aren't many people who get the chance to analyze venture capital fund return data. Mattermark just posted a short report full of such statements and the former 21 year old institutional LP analyst in me (the job I got my VC start in over 15 years ago) flipped his s**t upon close review.

Venture Capital 66

Venture Capital IRR LP .Net 66