David Teten

MARCH 18, 2021

As such, there are 3 stakeholders when building a thesis: the investing Partners, the LPs and the founders. . It incorporates influences from the LP and, more and more, from the founders. Alexander Jarvis , startup mentor, said, “Even at a later stage, it’s better to be talked about something than nothing at all.

Technical Review 78

Technical Review Cofounder Venture Capital Deal Flow 78

David Teten

SEPTEMBER 23, 2017

Even for later-stage companies with predictable financials, the lack of liquidity, audited financials, and standardized metrics creates real challenges to scaling quantitative investing. Later stage investors are using private company marketplace services focused on more established companies, listed below under “Exit Investments”.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

David Teten

JANUARY 21, 2021

Prasanna Krishnamoorthy, Managing Partner, Upekkha Value SaaS Accelerator, said, “We are the first fund which combines an Angel List rolling fund structure for making LP access widely available, while using the variable VC model of giving founders the option to buy back their equity at a later stage, ensuring founder optionality.

Equity 78

Equity Revenue Cofounder Colorado 78

Both Sides of the Table

FEBRUARY 4, 2016

” There are a lot of data points that one can observer to get a sense of the venture capital markets – both LP fundings into venture and VC financings of startups. We surveyed 73 LP firms to get their views on the market. “This is the year the tortoise may gain on the hare.” How do I know?

LP 150

LP Valuation Burn Rate Pre-Money Valuation 150

Both Sides of the Table

MAY 27, 2016

During the Q&A I was asked about how I make investment decisions in early-stage businesses. I was asked again in an LP meeting later in the week and then again at a founder breakfast gathering we hosted yesterday. Early stage. I answered in the same way I always do so I thought I’d just write it publicly.

Early Stage 254

Early Stage Non-Compete LP Later Stage 254

Both Sides of the Table

MAY 25, 2013

But the larger funds usually have lower returns because they are often investing bigger dollars at later stages with less risk and therefore lower returns. As you can see in this Cambridge Associates data, early-stage investing beat later stage investing in returns in 70% of the past 30 years. That’s normal.

LP 374

LP Later Stage IRR Term Sheet 374

VC Adventure

MAY 5, 2022

BUT (and you knew there was a but here given the post title…) it’s a poor way to compare the relative performance of funds early, and even into the mid/later, stages of a fund’s life. But that doesn’t seem to be stopping funds or LPs from touting IRR as the gold standard for evaluating relative fund performance.

IRR 116

IRR Metrics Valuation LP 116

K9 Ventures

AUGUST 14, 2017

It was a conscious decision to maintain the fund size at the same level, despite both market pressure (larger rounds at earlier stages) and demand pressure (lots of LP money entering the stage) to raise a larger fund. And yes, I’m presently 42.

Technology 96

Technology LP San Francisco Portfolio 96

Both Sides of the Table

MAY 24, 2021

But markets have changed and I think investors, founders and experienced executives who want to join later-stage startups can all benefit from playing the long game. But in the LP world there is an obsession with “top quartile” benchmarking in the near term, which drives skewed incentives for newer VCs to show quick returns.

Venture Capital 363

Venture Capital LP Valuation Later Stage 363

Both Sides of the Table

AUGUST 24, 2015

At least later stage investors. This could have an impact on later-stage valuations. The one thing that has become clear to me over the last couple of months is the skepticism that many late-stage VCs (and LPs) have had about late-stage valuations. I have to assume other investors feel the way I do.

Stock 150

Stock Finance Marketing Valuation 150

K9 Ventures

OCTOBER 10, 2017

The first time I used the words “pre-seed” (yes, the initial use was in all lower-case, but then became upper-case over time) was on June 27, 2013, at the K9 Ventures LP Meeting. They talk about how deal sizes and stages were changing even back then. Where did the term Pre-Seed come from? Seed rounds were getting bigger.

Seed Stage 82

Seed Stage Finance Later Stage Equity 82

Austin Startup

JUNE 26, 2019

Do you want someone already making $12–17/hour watching your kid to make less (so a LP can make their returns…)? Trouble is, the childcare industry is based heavily on human capital that is already underpaid. This all points, in my view, to the competency with this market. People are trying, and we should keep trying.

Silicon Valley 54

Silicon Valley Startup B2C Sweat Equity 54

K9 Ventures

OCTOBER 12, 2015

Not to mention that in later stages, high valuations can almost be fatal for some companies that don’t have the operating metrics to justify those valuations once the market turns. I’ve often said in private that I blame LPs for the cyclical nature of the venture industry. As valuations increase, VC returns go down.

Venture Capital 48

Venture Capital Seed Stage LP Valuation 48

Babbling VC

JULY 21, 2011

LP's, the investors in funds, come to you asking to invest in your fund instead of you going to them begging for their money. When you speak with LP's, they are consolidating their positions in the segment, investing in fewer funds and only the best. What does it mean to be a Tier 1 VC? This allows for some healthy competition.

Europe 74

Europe LP Venture Capital Restful 74

The Startup Lawyer

JANUARY 6, 2011

Later stage opportunities are also out of the mandate of our fund. Assuming a Corporate VC is operating a traditional fund vehicle and not just investing off of the balance sheet (probably the first real difference), I would say the most recognizable difference is in the single vs. multiple LP structure.

Early Stage 58

Early Stage LP Later Stage Balance Sheet 58

Professor VC

DECEMBER 8, 2015

Luckily, Google was one of the 150 and did ultimately return the fund assuming the LP was smart enough to hold the stock after distribution. I was a Limited Partner in Angel Investors II (Ron Conway's angel fund) that was an investor in Confinity. At the IPO, Musk held a 14.2% stake vs Thiel's 5.6% (Sequoia Capital had 10.7%).

Merger 28

Merger LP IPO Redemption 28

VC Cafe

APRIL 9, 2010

The combination of companies looking for capital and investors looking for liquidity put a strain on early stage start ups but seemed to have played favourably for growth equity investments and later stage companies. NGN Capital; Peregrine Ventures Buyer Funds: NGN BioMed Opportunity II LP. Battery Ventures. Feb-2-2010.

Venture Capital 68

Venture Capital LLC LP 68

thebarefootvc

MARCH 8, 2012

While the initial fund is $120M we will have access to ru-Net’s (the Russian LP) $700M of capital to support growth of portfolio companies and opportunistically invest at later stages where we can add value beyond capital.

Silicon Valley 69

Silicon Valley Ghana Venture Capital India 69

Both Sides of the Table

JUNE 29, 2011

Some have done earlier-stage deals and done well. Others have chased earlier-stage but lack the skills or relationships to do this effectively. Some have moved into later stage investments in an effort to “put logos on their websites.&# The LP Community Hasn’t Yet Caught Up. I think some will do this.

Venture Capital 296

Venture Capital Software LP Early Stage 296

Pascal's View

SEPTEMBER 24, 2008

Whether it is a firm applying its investment strategy to a new vertical, naturally taking advantage of earlier or later stage investment opportunities in its knowledge “sweet spot”, or opening an office abroad to seek international investments, there has been no shortage of ways to grow a maturing venture firm during this industry-wide evolution.

Venture Capital 28

Venture Capital LP Later Stage Vertical 28

Altgate

MARCH 8, 2009

There are three types of venture investing (early stage, “growth&# stage and later stage. Early stage means the first real investors in a startup when the team could be as small as 5-10 people. So in the current collapse, the later stage investors will fare the best, or should I say least worst.

Later Stage 34

Later Stage Early Stage Venture Capital Portfolio 34

K9 Ventures

NOVEMBER 30, 2008

The LP perspective. Institutional LPs typically diversify their portfolios by investing in multiple asset classes. LPs have invested in Venture Capital because as a class venture capital is both a high-risk, but high reward asset class. Venture is just one of the asset classes they invest in.

IRR 48

IRR Venture Capital LP Early Stage 48

This is going to be BIG.

MARCH 3, 2019

We do the work of sorting through the pitch decks of everyone and their mother, finding the diamonds in the rough, helping them turn an idea into something that looks like a company—and we do it for a fraction of the management fees of our later stage counterparts.

Portfolio 110

Portfolio Burn Rate LP Distribution 110

This is going to be BIG.

SEPTEMBER 7, 2012

I know, because those people all used to pitch me as an institutional LP back in the day. Some of this thinking is also driven by folks who aren't well connected to the rest of the later stage venture community. I thought the numbers prove this--because big later stage underperforms small early stage.

Later Stage 99

Later Stage Down Round Pre-Money Valuation Early Stage 99

abovethecrowd.com

APRIL 20, 2016

Some later-stage investors may be tempted to become Sharks themselves and start including structured terms into their own term sheets. One response from the LP community might be to demand commitments from new funds that prohibit inside-led rounds and cross-fund investing. If you over-fund the industry, aggregate returns fall.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Both Sides of the Table

MARCH 12, 2017

VCs don’t expect any serious corrections to valuations in 2017 and they seem to be taking financial discipline in later-stage companies more seriously valuing unit economics over “growth at any cost.” Again, I suspect they would be more concerned today about net neutrality, cyber security, immigration and trade more broadly.

Venture Capital 277

Venture Capital Artificial Inteligence LP Valuation 277

Both Sides of the Table

JANUARY 30, 2016

I told him that I had observed every LP on their computers doing email and that clearly they were bored, to which he replied, “We like boring Powerpoint presentations. When we were rebuilding our LP base one of the single most helpful person to me as a friend, sparring partner and reference was Dana Settle of Greycroft.

Community 150

Community Los Angeles LP Portfolio 150