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The Experience of Being a Limited Partner in Venture Capital

This is going to be BIG.

Either way, VC funds aren't really built around creating much of an experience for their Limited Partners. Rather than see LP interactions as a chore or a burden, new fund managers should see this as an opportunity to extend the community around their fund. Partnership investing is boring. Did you communicate with them?

Investing in Venture Capital - Limited Partner or Fund of Funds? - Part 2

Recent Buzzes - VC Experts, Inc.

By Igor Sill, Managing Director of Geneva Venture Management LLC. Sill, Managing Director, igor@genevavc.com. Igor M.

Investing in Venture Capital - Limited Partner or Fund of Funds? - Part 1

Recent Buzzes - VC Experts, Inc.

By Igor Sill, Managing Director of Geneva Venture Management LLC. Portfolio managers should fear failure, not illiquidity. Igor M.

Managing Investor Pedigree

StartupCFO

Cambridge Associates , an advisor to the Limited Partners that invest in venture capital firms, says that only about 20 firms – or 3% of all firms – generate 95% of the industry’s returns. . The post Managing Investor Pedigree appeared first on StartupCFO : Mark MacLeod. Those 20 firms remain pretty consistent over time.

A brief history of your investors (and their investors)

Venture Hacks

Thanks to George Zachary , a partner at Charles River Ventures , for sponsoring Venture Hacks this week. And what did the limited partners do?

VC Governance FAQ: (1) How much information are limited partners (pensions, endowments, foundations, etc.) entitled to receive from a VC fund?

Pascal's View

Question: How much information are limited partners (pensions, endowments, foundations, etc.) entitled to receive from a VC fund?

Katie Rae and the Engine at MIT

David Cohen

Katie was the Managing Director at Techstars for our Boston program from 2010 to 2014. We became a Limited Partner in Project 11 when it launched and Katie continues to mentor at Techstars regularly. I personally learned a ton from Katie and while I sad when she departed Techstars a few years ago, we’ve stayed close.

What Founders Need to Know: You Were Funded for a Liquidity Event – Start Looking

Steve Blank

BTW, Angel investors do not have limited partners, and often invest for reasons other than just for financial gain (e.g., Liquidity.

What’s a typical day like for a full-time angel investor?

Gust

If you mean someone investing mostly other people’s money through a seed fund, they are venture capitalists, and their days are spent like other VCs, meeting with prospective investments, mentoring portfolio companies, raising money from limited partners, negotiating deals, and so forth.

Why the LP Outlook is Good for Venture and Startups in 2017–2020

Both Sides of the Table

So LPs are looking for a combination of “established top tier” and “new managers with differentiation.” We’re trying to limit our exposure.”

LP 75

Similarities between raising a venture fund and raising for a startup

The Equity Kicker

A major complaint from fund managers is that LPs don’t reply to their emails and let them know how their investment case is progressing.

How do venture capital firms make money by investing in startups?

Gust

The general partners of a venture capital fund make money… …by raising the bulk of the capital that the fund’s investable capital from “Limited Partners”, usually institutions such as university endowments, insurance companies and pension funds. This is the money that is invested into the startups.

Entrepreneurs Teach VCs to be VCs

A VC : Venture Capital and Technology

They taught me a lot about finding and researching opportunities, structuring deals, managing a fund, and working with limited partners.  Isaak Karaev stopped by and left a comment in yesterday's thread. Isaak is one of the first entrepreneurs I backed in my career. I backed him again more recently.

Top 100 venture VC investments each year average $100-150m gain

The Equity Kicker

Their advice to LPs is to catch these distributed returns by investing in emerging managers outside of traditional US venture heartlands.

Let Your Winners Run

A VC : Venture Capital and Technology

The entrepreneur and her management team generally makes that call and the board is asked to ratify it. But I am fairly sure that my partners and I and our limited partners will be happy to let this fund play itself out over a longer period of time.   Then I took questions. I've got scars from this one.

How long does it take for investors to approve the idea and to grant the necessary investment?

Gust

Instead, they have a limited amount of money entrusted to them by limited partners, and they invest in a very, very few companies each year. Now, with that as background, it will typically take one to three months to negotiate and diligence a venture investment, if the company manages to get one at all.

CasaSiegel: Timeless learnings

CasaSiegel

With the support of some key Limited Partners (LPs), our second fund is already larger than our first, and we will thus have the ability to execute on the strategy of investing in breakthrough technologies that come from major research institutions and to deliver venture-level returns. CasaSiegel. Monday, September 19, 2011. scenarios.

Blue Collar VC

Mucker Lab

Just as entrepreneurs should aspire to raise capital from value-added, “smart money” investors, we, too, have focused on partnering with committed, long-term, institutional limited partners (LPs). We’ve written code, launched products, acquired users, managed P&Ls, and lost sleep over making payroll. We understand.

There are no shortcuts to intelligent Founder – CEO transitions

Fred Destin

Founder transition is one of those tense topics that holds limited upside for the writer, especially when said individual is a venture capitalist.

Non traditional venture investors are still getting to grips with startup investing

The Equity Kicker

Perhaps the biggest story in venture capital from 2012-2015 was the rise in late stage valuations. So lots to figure out. Venture Capital

Where Does VC Money Actually Come From? [Flowchart]

View from Seed

This post was originally published on the personal blog of NextView founding partner Lee Hower. Subscribe here for more. Endowments.

LP 155

Where Do Venture Capital Dollars Actually Come From? This Visual Explains

Agile VC

Most of the dollars a VC firm invests come from outside limited partner investors (LPs). Click the image to view a larger version.).

When Does a Seed Stage Company Need a Board with More Than Just the Founder?

ithacaVC

One final thought – what about the VC’s fiduciary duties to its own investors (called limited partners). It is reasonable to think that the limited partners would expect their money managers (i.e., I think many limited partners would answer “yes” Love to hear your thoughts on this.

Writing Checks Doesn't Make You an Investor

This is going to be BIG.

You might work with the same group of investors, contractors, agents and management companies for decades. If you're a VC, you should do whatever you can to make your limited partners feel like investors. It's an asset class built on relationships. These are incredibly impactful relationships dependent on trust.

Valuation vs Ownership

A VC : Venture Capital and Technology

It's the limited partners who get screwed by this stuff. And the firm offering $5mm for 20% will likely have a $500mm fund size (or more) and will be making $10mm or more per year in management fees. I am talking at the PreMoney conference today (via Skype) and I woke up thinking about the challenges facing the VC industry.

Why Big IPOs Mean More Money for Your Startup

Fresh Inc.: The Staff Blog

For the limited partners, venture capital is considered a risky asset class. Why that''s good news for you. Venture Capital Index was 7.7

Why You Don’t Want to Give Financial Information to All of Your Investors

Both Sides of the Table

I am generally a fan for providing management updates periodically for all investors but in doing so you must assume that what you send out will get read by others and thus hold back on your most sensitive information. We all know that funding markets have changed for startups. What is less understood are the consequences of these changes.

SEC 109

The Perception Of Conflict Is Conflict

A VC : Venture Capital and Technology

Our shareholders are our limited partners. And managing that is the most important thing of all. VC is a service business like law firms and ad agencies. Our customers are the entrepreneurs we back. When we do a good job of helping our customers create value, our shareholders benefit. Again he was surprised.

Investor Nomenclature and the Venture Spiral

K9 Ventures

They are still individual investors, they invest on a full-time basis as professionals, but they have funds with Limited Partners. Angel.

What Do LPs Think of the Venture Capital Markets for 2016?

Both Sides of the Table

But both seed investors and LPs alike agree that as long as these programs are managed sensibly, their existence is useful. Sorry! Summary.

Angel Investing: Know (What Motivates) Thyself

Agile VC

As a VC investing not only personal capital, but on behalf of limited partners, one can’t take this strategy. I was recently talking with another member of LinkedIn’s founding team. I think the most important thing any new angel investor can do is to candidly assess their motivations for making startup investments.

Five Lessons Learned Getting to a Second Fund

This is going to be BIG.

Today, I'm happy to announce that Brooklyn Bridge Ventures, the firm I founded and continue to run as the sole General Partner, has raised a second fund, totalling $15.1 I do fine and pay my bills but greater scale, more management fees, and a bigger operation would undoubtedly put more money into my pockets in the short term.

Why Was Winter in Venture Capital Funding so Short?

Both Sides of the Table

In case you’re keeping score at home — that’s approximately the size of 65 US seed-stage funds managed by one company. Ok, Suster.

The Changing Structure of the VC Industry

Both Sides of the Table

15 years ago we were at the peak of Internet hype with the launch of many over-capitalized businesses with a market size & opportunity was limited.

Why VC’s Don’t “Crossover” Invest

Agile VC

As most of you probably know, the vast majority of VC firms make investments out of funds structured as limited partnerships with a 10yr life.

LP 36

The Economics of a Small VC Fund

This is going to be BIG.

management fee. It''s only a little bit of a performance drag, though, because management fees act like a loan. You charge your limited partners this, but you have to pay it back before you start taking a cut of the profits. Two years ago I started a fund. Thankfully, that''s what I raised--$8.3 million. Legal is lumpy.

The Myth of the Top Investor

This is going to be BIG.

It means that if you ever have an opportunity to be a Limited Partner in Sequoia, and to do so over multiple funds--with a very long term (20+ years) time horizon--you should probably do it. It also doesn't mean that, if you're an entrepreneur, they're the right partner for you. So what does that mean? What doesn't it mean?

Startup Fairy Tales and Other Tall Tales That Venture Capitalists Tell

Growthink Blog

Management has the wrong pedigree, is geographically undesirable, competes in the wrong industry, and/or has a business model that lacks "scalability credibility" with the venture community. At the end of the period, all profits and proceeds are distributed to the various partners on a pre-determined split. All live happily ever after.

Our Sale of Masergy Communications

Non-Linear Growth

In late July, my Partners and I at Meritage announced that our portfolio company Masergy Communications had agreed to be acquired by ABRY Partners. ABRY bought a fine, fine business here and will now have the opportunity to work with what I think is one of the most capable management teams in the communications segment.

This Week In Startups

A VC : Venture Capital and Technology

38:15-39:15 Does that make that person impossible to manage? 43:45-45:30 Are limited partners stoked about the secondary market?

Audio 47