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What Does the Post Crash VC Market Look Like?

Both Sides of the Table

IRRs work really well in a 12-year bull market but VCs have to make money in good markets and bad. We don’t want to compete for the largest AUM (assets under management) with the biggest firms in a race to build the “Goldman Sachs of VC” but it’s clear that this strategy has had success for some. It’s just math. So it’s about 20%.

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IRR is a vanity metric

VC Adventure

I’m observing that IRR is a metric that is becoming an increasing focus in venture, replacing fund return multiple as the key metric of success. I understand the draw of IRR, and – as a fund draws to a close – there’s no question it’s an important metric. Recycling hurts IRR. management fee).

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How’s Venture Capital Changing in 2023

VC Cafe

By contrast, they backed 620 funds in the last three months of 2021 First time fund managers hit hard: In 2022, limited partners backed 141 funds run by first-time managers, a 59% decline from the prior year and the lowest number since 2013 How does the constrained LP environment manifest for funds and startups?

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How is the VC Asset Class Doing?

View from Seed

One or two of the best companies may continue to appreciate, but most of a VC’s portfolio has probably been realized, written off, or has maxed out its value. The longer the portfolio maintains the same value without distributing back cash, the worse the fund’s ultimate IRR. So, is this good or bad? LP Constraints.

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How Covid-19 Has Impacted VC Portfolios

View from Seed

One topic of conversation among VC’s over the last few months is how their portfolios are faring during the Covid pandemic. So I thought I’d share my observations, informed by what’s going on in our portfolio and from what I can gather from others in the ecosystem. Reshuffling the deck.

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Flexible VC, a New Model for Companies Targeting Profitability

David Teten

As two fund managers employing Flexible VC, we think it is a healthy addition to the ecosystem and will yield more predictable and stable healthy returns for investors. Too often, investment structures force the management team to make decisions between misaligned growth and investment (return) objectives. Early liquidity.

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ESADE Business School Commencement Speech

Steve Blank

But the world you lead will be much different from the one your professors knew or your predecessors managed. Yet in the face of all this change, traditional firms continue to embrace a management ethos that values efficiency over innovation. To manage these employees companies create metrics to control, measure and reward execution.