View from Seed

AUGUST 17, 2021

One industry specific example is the strange fascination among some LPs and GPs around term IRR. Even though everyone knows that VC funds take 10+ years to come to fruition, one often can’t help but benchmark themselves based on IRR in the early days.

IRR 205

IRR Dilution Founder Portfolio 205

View from Seed

AUGUST 17, 2021

One industry specific example is the strange fascination among some LPs and GPs around term IRR. Even though everyone knows that VC funds take 10+ years to come to fruition, one often can’t help but benchmark themselves based on IRR in the early days.

IRR 156

IRR Dilution Founder Portfolio 156

View from Seed

AUGUST 17, 2021

One industry specific example is the strange fascination among some LPs and GPs around term IRR. Even though everyone knows that VC funds take 10+ years to come to fruition, one often can’t help but benchmark themselves based on IRR in the early days.

IRR 136

IRR Dilution Founder Portfolio 136

Steve Blank

MARCH 31, 2014

In spite of this, private equity funds have used the rallying cry of efficiency to hijack corporate strategy and loot the profits that historically would have been reinvested into research and development and new products. Smart companies are always looking to make their current products better – and there are many ways to do this.

Private Equity 326

Private Equity Metrics China Intellectual Property 326

David Teten

JANUARY 19, 2021

Flexible VC creates early liquidity which can be either reinvested or distributed to LPs. This causes the cost of capital for Flexible VC, often calculated through IRR (similar to an interest rate), can be higher than that of venture debt or traditional RBI. 20-30% is a common target IRR for investors. Early liquidity.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Both Sides of the Table

MAY 25, 2013

As you can see from the chart their data suggests there are about $25 billion of VC distributions per year in the US. The better way to think about VC returns is, do the firms consistently beat alternative asset clases on an IRR basis to adjust for the increased risk and lack of liquidity? The top 2% do not drive 98% of the returns.

LP 374

LP Later Stage IRR Term Sheet 374

abovethecrowd.com

APRIL 20, 2016

And unfortunately, you may assume that the product of your Unicorn valuation and your percentage ownership is what you are worth. Do you feel the need to raise more capital quickly before the prices erode further and bring down your IRR? You know you work for a Unicorn, and you know you have some common shares. LIMITED PARTNERS (LPS).

IPO 40

IPO Term Sheet Silicon Valley Valuation 40