Both Sides of the Table

MARCH 1, 2016

At the Upfront Summit in early February, we had a chance to have many off-the-record conversations with Limited Partners (LPs) who fund Venture Capital (VC) funds about their views of the market. LPs See The Over-Valuations and Don’t Like It. All isn’t completely rosy in the LP views of the venture industry.

Venture Capital 150

Venture Capital LP Silicon Valley Marketing 150

Feld Thoughts

AUGUST 13, 2018

Several years ago, I wrote a post titled Why VCs Should Recycle Their Management Fees. We feel that if an LP gives us a $1 to invest, we should invest at least that $1, not $0.85 (the average fee load over a decade for a typical VC fund is 15%.) From the start of Foundry Group in 2007, we have felt strongly about this.

LP 117

LP Management Carried Interest .Net 117

Hunter Walker

FEBRUARY 21, 2023

An Economic Vehicle With a Societal Mandate, Screendoor Backs Emerging Managers from Underrepresented Groups My hope for Screendoor is clear, if not simple: we’re going to be the largest, and most impactful, investor in emerging managers. In today’s vast venture capital landscape, it’s ALPHA!

Venture Capital 89

Venture Capital LP Hiring Management 89

David Teten

MAY 20, 2016

As one of the lead engineers at ff Venture Capital , I spend most of my day building custom software solutions that enhance our firm’s process–tools that range from portfolio investment management to co-investor and cap table tracking and more. We posted on our site a more in-depth overview of ff’s Tech Platform.

Private Equity 113

Private Equity Equity Cap Table Venture Capital 113

Both Sides of the Table

MARCH 24, 2014

Getting Exits / Driving LP Returns: This was always the knock on me. I’ve now been involved with many other successful foll0w-on financings. So I think it’s now fair to rate me at 9/10 on follow-on fundings. The monkey on my back. “Ok, so this guy can write a blog and source deals but can he make any money?”

Los Angeles 387

Los Angeles Intellectual Property LP Venture Capital 387

David Teten

MAY 16, 2017

A few years ago, I presented at an Invesco conference on Emerging GPs, and one of the highlights was a presentation by Laurie Weir summarizing CALPERS’ selection criteria under their Private Equity Emerging Manager Program Review. Denis Tse: Fund Management Craftsmanship: An LP’s Food for Thought for Emerging VC General Partners.

Private Equity 60

Private Equity Venture Capital Technical Review Equity 60

Feld Thoughts

MARCH 24, 2017

Foundry Group is best known for our investments in startups, but our vehicle currently investing in other venture funds, Foundry Group Next, is off to what we believe to be a great start and I wanted to share an update about it by talking about our new investment in a fund managed by Founder Collective. It starts with the people.

Founder 75

Founder LP Technical Review Seed Stage 75

Version One Ventures

JANUARY 31, 2024

As one fellow VC said to me, “Raising a fund for an emerging manager in 2024 might be one of the hardest things you can do”. The first is the fund that you would ideally raise if LP capital was not a constraining factor. In this market, emerging managers should be more focused on the minimum viable fund rather than their ideal fund.

LP 73

LP Differentiation Deal Flow India 73

View from Seed

SEPTEMBER 23, 2020

After building NextView for almost 10 years now, I’ve been having more conversations recently with first time managers looking for some tactical advice. At first glance, you’d think that all LPs pretty much want to buy the same thing. Every fund pitching an LP is pitching this as a baseline. Are they a principal or an agent?

LP 309

LP Customer Early Stage Portfolio 309

David Teten

SEPTEMBER 26, 2016

Among the speakers are: Aaron Brown, Chief Risk Officer, AQR Capital Management. Fabio Mercurio, Head of Quantitative Analytics, Bloomberg LP. Head of Portfolio Management, AQR Capital Management. This is a large conference focused on quant and automated investing, big data, and High Performance Computing.

New York 60

New York Fractional CTO CTO LP 60

YoungUpstarts

OCTOBER 23, 2017

by Joe Duncan, founder of Duncan Capital LP. Morgan Stanley predicts that Robo Advisors will manage $6.5 In client coverage, that same Morgan Stanley who forecast robot’s managing 5% of the world’s wealth by 2025, in May announced their 16,000 brokers were getting a machine-learning algorithmic boost. Transaction Processing.

Technical Review 131

Technical Review Artificial Inteligence Software Review IPO 131

Version One Ventures

JULY 24, 2019

The primary responsibility will be to help manage the day-to-day activities of the fund, including: Identifying new and interesting entrepreneurs and companies that align with our investment thesis on network effects. Reporting for our investors, including writing quarterly updates and preparing LP advisory board meetings.

Technical Review 125

Technical Review Advisory Board Due Diligence LP 125

Agile VC

OCTOBER 23, 2012

The VC industry (both the GP part and the LP part) pays attention to the sector’s returns, but the broader tech ecosystem only occasionally tunes in. 2) No Synthetic Alternative – If an LP can’t “buy” VC as an index, could they replicate the returns of an index some other way?

LP 176

LP Accredited Investor Carried Interest Portfolio 176

David Teten

MARCH 14, 2018

Managers of VC funds typically want to grow their business aggressively, just like the founders we back. This is a model used in at least one case by China’s third-largest private equity firm, China Science & Merchants Investment Management Group ($12 billion+ AUM), which funded in 2015 CSC Upshot, a $400m seed fund through AngelList.

Private Equity 60

Private Equity Venture Capital Equity Cofounder 60

Both Sides of the Table

MAY 27, 2013

He wrote a post this long weekend on how he manages the board of DataSift. In this period (less than 2 years) he has brought on incredibly talented senior execs is sales, marketing, product management, client services, finance, vp engineering and more. Rob Bailey is the CEO of DataSift. You should read it. Email updates frequently.

Advisory Board 365

Advisory Board CTO Hire Fractional CTO Los Angeles 365

The Equity Kicker

MARCH 19, 2012

The LP Update Meeting. I’m just back from our semi-annual update to the LPs in one of our funds, and I thought I would share the experience with you all. We have around a dozen LP update meetings a year across our four funds and they are the most important moments of contact we have with our investors. Manager update.

LP 97

LP Europe Portfolio Private Equity 97

Both Sides of the Table

FEBRUARY 20, 2019

But gone are the days where VCs put dollars into companies and ask founders to step aside quickly so that the VC can install their favorite management team. The start is about inspiration, vision, product, early execution whereas the scale is about team management, process and consistency. Is it possible that you get fired?

Venture Capital 236

Venture Capital Startup Angel Investor Silicon Valley 236

Eric Friedman

DECEMBER 27, 2021

Bullish in this space since 2015 I see the air cover in place for institutions and private wealth managers to now take the plunge. Operating as a sort of fund-of-funds model there is an economy of scale program for figuring out the GP/LP structure, working out the services providers like legal, audit, and tax handling.

Balance Sheet 97

Balance Sheet Stock Private Equity Option Pool 97

Both Sides of the Table

OCTOBER 12, 2014

But with the massive growth of seed funds being raised and the huge value increase of prorata rights many more LPs have stepped in to take their VC (industry term is GP) position. What would you do as an LP fund if you backed a seed-stage GP who had a position in Twitter, Pinterest, etc. Why prorata rights are being guarded by VCs.

Technical Review 336

Technical Review Later Stage Early Stage LP 336

Both Sides of the Table

FEBRUARY 25, 2019

I work hard to create working relationships with my fellow non-management board members in the same way that every investor ultimately works to develop strong working relationships with founders. A high-functioning board comes with active management and you actually have to care about having a high-functioning board.

LP 269

LP Startup Burn Rate Stock Options 269

Both Sides of the Table

SEPTEMBER 22, 2012

Instant growth = huge valuation from follow-on investors = big VC mark-up on our quarterly reports = LP interest. My first company was used to manage workflow & share CAD drawings and plans on the $16 billion refurbishment of the London Underground. They want to know that you’re in Twitter, Facebook, Square, Fab and the like.

Silicon Valley 390

Silicon Valley Venture Capital Startup Technical Review 390

Feld Thoughts

MAY 28, 2014

Some of them recycle their management fees; others don’t. I’ve never really understood why funds don’t recycle their management fees. Understanding what “recycling management fees” means is a fundamental part of understanding the economics of a venture firm. Here’s how it works.

Management 150

Management .Net LP Venture Capital 150

Babbling VC

NOVEMBER 2, 2018

You would presume that management would in these situations raise an alarm and make sure that things are addressed before they are irreparable. The same goes for the LP's (limited partners) that invest in venture funds. If a fund has run it's course and can't raise further capital due to poor performance, the LP's walk away.

LP 151

LP Limited Partner Management Naming 151

Babbling VC

OCTOBER 3, 2011

For those of you not in the know, they are one of the largest limited partners ( LP's : investors in venture capital funds) in Europe and are basically in almost all the funds throughout the market. Hypothesis 3: Insufficient diversification in European VC managers’ portfolios . This for me is a no-brainer.

LP 82

LP Europe Germany Venture Capital 82

Both Sides of the Table

JULY 23, 2014

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? and the bigger funds can’t get in directly.

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

Both Sides of the Table

FEBRUARY 18, 2017

Recently the firms two founding partners (and also Managing Partners) —  Fred Wilson and Brad Burnham  — decided to transition management of the firm to Andy Weissman (who joined in 2012) and Albert Wenger (joined in 2008 and writes one of the most thoughtful blogs in our industry ).

Leadership 161

Leadership LP Venture Capital Silicon Valley 161

Hunter Walker

AUGUST 8, 2023

Obvious caveats to my POV here, most specifically: exposure is limited to largely the US/SiliconValley ecosystem, driven by our own portfolio, my friends and co-investors, the funds I’m a LP in, and our institutional LP relationships. Fund Sizes Got Too Big. Firms raised too much money.

Portfolio 98

Portfolio Cap Table LP Valuation 98

This is going to be BIG.

OCTOBER 12, 2020

The new point person seemed intent on bringing in new managers. I took my last LP meeting the first week of March and clearly, I didn’t close anyone that I had met with at that time. Not everyone produces LP money with the snap of a finger—not even Alan Patricof. It was the first anyone had asked me about it.

LP 136

LP Technical Review Software Review Valuation 136

David Teten

JANUARY 19, 2021

As two fund managers employing Flexible VC, we think it is a healthy addition to the ecosystem and will yield more predictable and stable healthy returns for investors. Too often, investment structures force the management team to make decisions between misaligned growth and investment (return) objectives. Early liquidity.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Feld Thoughts

JULY 17, 2023

When that ultimately failed , I began supporting several grassroots movements like the GEiR program , invested in companies founded by immigrants, am an investor and board member of Boundless , an early LP in Unshackled Ventures (unrelated to this book), and even became the executive producer of a movie called For Here Or To Go.

United States 83

United States LP India Campaign 83

Austin Startup

AUGUST 10, 2017

Before graduating, I decided to forgo the finance path and instead dove into engineering and later sales and product management roles at VersaSuite (health IT) in Austin. Diversified funds are the most effective way to manage exposure to this volatile, rapidly evolving asset class. We were infatuated with tech.

Technical Review 48

Technical Review Cofounder Technical Cofounder Austin 48

David Teten

SEPTEMBER 23, 2017

A major angel group used Influitive , an advocate management tool, to track, activate and motivate their members. 4) Manage deal flow. For example, we created a pipeline management tool that automatically adds deals along with relevant information (such as attachments received) to our funnel. Pitchbot.vc 5) Due diligence.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

Both Sides of the Table

JUNE 29, 2014

It had an influence on the people who fund our industry in a negative way as many asset managers who fund our industry read this flawed report. I saved it mostly for LP discussions that I had over the past year. ” The most recent was 18 months ago or so called The Kauffman Report.

Venture Capital 362

Venture Capital IPO Jordan LP 362

Both Sides of the Table

MAY 25, 2013

But as an LP you can’t count on that any more than VCs can. The goal of an LP is to get into the top decile. When it went to raise its fund 10 years ago the rumor was that many LPs were disappointed with recent returns and did not re-up. In 2000 our industry had more than $100 billion in LP money. It is changing.

LP 374

LP Later Stage IRR Term Sheet 374

David Teten

JANUARY 23, 2021

For example, one LP told me she prefers customized emails from fund principals, as opposed to a bulk-mailed quarterly update. In particular, highlight the metrics by which you measured your past activities: size of exit, number of people you managed, $ budget you were responsible for, etc. We are using Digify to manage this.

Private Equity 78

Private Equity Venture Capital Technical Review Software Review 78

This is going to be BIG.

MARCH 14, 2019

If you’re not actually modeling this out with a spreadsheet, I don’t know how you can look an LP in the face and say this. I ask the same of new managers. It’s easy to say you’re going to be a 3x fund, but how does the math actually get you there. I think the results will surprise you how hard it is to be successful.

LP 97

LP Due Diligence Portfolio Distribution 97

VC Cafe

JULY 4, 2022

Another impact of the meltdown of the public markets is on performance, in LP and VC books which resulted in 68% of funds estimated to have marked down companies in their portfolio. In terms of TVPI, the total value to paid-in ratio used by fund managers to evaluate a fund’s performance, the median dropped 3.5%

Venture Capital 167

Venture Capital Valuation Private Equity LP 167