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It’s Morning in Venture Capital

Both Sides of the Table

Cloud computing and the open source movements have brought down the costs of starting a company by more than 90%. Thomson Reuters data shows that around $10 billion of LP money went into VCs per year pre bubble. By 2000 the total LP commitments had mushroomed to more than $100 billion. The Funding Problem.

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What’s Really Going on in the VC Industry? What Does it Mean for Startups?

Both Sides of the Table

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%.

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Startup 101: “Open Source” Start up Legal Documents

VC Cafe

Legal docs don’t have to be a source of stress when you’re trying to set up a business. Don’t use these documents blindly ” Taylor Wessing – offers a suite of seed investment documents which are available on an open-source basis. Find it all here: [link] uk/node/104.

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Does Your VC have an Investment Thesis, or a Hypothesis?

David Teten

(co-written with Stephane Nasser , co-founder of OpenVC , an open-source initiative to collect and analyze all VC theses.). OpenVC is a new, open-source initiative to collect and analyze all publicly available VC theses, to help founders more efficiently find the right investors, and vice-versa.

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The Changing Structure of the VC Industry

Both Sides of the Table

At the other end of the spectrum large funds have gotten even larger in the past few years which has massively increased the amount of consolidation in our industry as 66% of LP money into venture is now concentrated in late-stage or full-cycle VCs. Why is this? 2007 was the watershed year.

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VCs eating our own dog food: Using technology and analytics to make better investments

David Teten

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. We are also seeing technology evaluation as an increasingly important part of LP operational due diligence.

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Flexible VCs With Structures Between Equity and Revenue-Based Investing

David Teten

They have open-sourced their investment structure , now on version 3.0, The fund’s network of mentors are all invested LPs, ensuring they have “skin in the game.” After a small pilot Fund I, Fund II is a rolling fund , allowing Earnest to grow LP capital to scale its investment activity over time. —– Indie.vc

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