One explanation for the correlations we’ve seen is that firms with the best deal flow and track records tend to be able to raise larger funds. In that case, the performance advantages they enjoy may be owed to their personal networks and not to fund size.
“Does Fund Size Matter?” via NEA
An interesting counter-argument to the smaller is better debate when it comes to VC’s. One note however is that personal networks might help with deal flow, but you still need to pick the winners, and the earlier on you get on board, the better. That favors smaller funds in my mind that have a more focused strategy, get on deals earlier in the funding cycle, and develop deep category expertise.
Source: nea.com
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