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Why LP’s Passed on Seed Funds 10 Years Ago (And What’s Happened Since)

View from Seed

And yes, a seed fund may have a tougher time holding on to their ownership down the road, and thus get diluted down. We’ve had multiple companies in our early funds that hit bumps and had to raise flat rounds, which hurts from a dilution standpoint but doesn’t wipe out our position. So yes, seed funds will own less. But guess what?

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Flexible VC, a New Model for Companies Targeting Profitability

David Teten

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. Similar to the explosion of seed funds in the past decade, we (and some limited partners too ) believe these Flexible VCs are on the forefront of what will become a major segment of the venture ecosystem. Of the Inc. 5000 companies, only 6.5% return cap.

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What Is Venture Debt and How Should Startups Use It?

View from Seed

Use good judgment, talk to your co-founders/investors/lawyers, and partner with a bank that values transparency and relationships such as SVB.]. And it’s that important because all companies will go through good times and tough times, and we’ll want to make sure we’ve got the right partner on the other side.

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On Human Capital & Venture Capital

thebarefootvc

If there is an opportunity to bring in a syndicate partner that will add exponential value, it would be foolish to not include them. It is the downturns and bumps that separate the dedicated, long-term investors from passive ones — and entrepreneurs should keep this in mind as they build out their syndicates.

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Some Reflections on VC Investment Decisions

Both Sides of the Table

I told my friend that I felt that in 2014 too many new VCs feel the pressure to chase deals, to be a part of syndicates with other brand names and to pounce on top of every startup whose numbers are trending up quickly. At our partner meetings the number one thing I look for in our decisions is the conviction level of the sponsoring partner.

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Written Communication is Critical for Fundraising

David Teten

A retail investor might join an existing syndicate on a crowdfunding site based on a deck and maybe an email. At the majority of VCs (including ours), you don’t just have to persuade one Partner. Providing answers in writing makes it easier for the lead Partner to share your view, and persuade her colleagues to back the investment.

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Texas Startup Manifesto 2.0

Austin Startup

These are all potential customers and strategic partners for startups. In 2019 and 2020, we saw hundreds of millions of dollars in non-dilutive funding go to Texas startups, most of which had never worked with the government before. More than 50 Fortune 500 companies are headquartered in Texas and six of the Fortune 50.

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