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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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How VCs Can and Should Invest in Later Rounds

David Teten

So when a company in which I’m an investor is raising a later round, should we (the VC investor) keep our pro rata or get diluted? . Ranked in descending order of frequency of use, they are: 1) Syndicate the investment out to coinvestors, without charging any fee. You have to know when to hold them and know when to fold them.


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If You’re Not Sure Whether Your Current Investors Would Give You More Money, The Answer Is Likely “No”

Hunter Walker

I really liked Jason Lemkin’s “ Do You Have a Weak Investor Syndicate ” blog post from earlier in the summer. I rather see the difference in dilution be used to continue hiring amazing team members going forward than add a few more basis points to my ownership. Go read it and then come back here…. Long term greedy!!!!

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A VC’s take on the Season 5 premier of Sharktank

Lightspeed Venture Partners

With his back to the wall and about to run out of money, his first priority should have been runway extension, not dilution from new capital. pre money valuation seems big, the actual implication is only between 5% and 10% dilution since the round size is small. But eventually two syndicates emerged.

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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. It is very difficult to get an investor to commit without that direct dialogue, ideally with as many of her colleagues as possible. However, usually the Lead Partner is going to do a worse job pitching you than you can.

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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. I guess if you’re in high-volume, low-differentiation mode perhaps this is efficient for you. I don’t.

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The Summer Solstice And Seed Stage Squeeze


Those employees and operators, who often have some book wealth now (or are running syndicates on AngelList or acting as a scout for another fund) can easily dump $50K-$100K into one of their ex-colleague’s new startups, or put this money into their friend’s new startup, or their friend’s new hot deal.