Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing

So how do Venture Capitalists raise funding?

VCs raise funding from limited partners which include family offices, high-net-worth individuals, foundations, pension funds, and other sources.

Institutional investors such as pension funds require a track record so first time VCs focus on family offices and high-net-worth individuals. 

Also, the VC fund may be too small. In most cases, institutional investors do not like to be more than a certain percent of any one fund due to concentration limits - usually no more than  20%.

The VC develops an investment thesis which is a reasoning why their approach to selecting and funding deals will be successful.

They build out their investment prospectus which includes the investment thesis, how it’s unique, the fees the limited partners will pay, and how the profits will be distributed.

The VC then meets with limited partners to pitch the investment thesis, track record, and view of the market.

Limited partners look to fund VCs who have a unique investment thesis and access to deal flow they do not.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
-----
For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

You can now start your own VC fund.

Venture capital, angel investing, crowdfunding, and most forms of startup funding are best done through a fund model for when deal flow volume reaches scale.   

A fund structure also provides diversification.

If you have experience finding and screening startups for funding and a track record for successfully investing, then you may want to consider starting your own fund.

As of this writing, there are over 4000 microVC funds in the US alone.  

These are funds with < $100M of raised capital with most in the $25M to $50M range.

Many of these funds are led by those who ran sidecar angel funds, invested their own money into startups and did well, or are experienced VCs who set out to run their own fund.

The funds tend to focus on a very tight niche in which they have access to quality deal flow. 

Most raise funding from family offices as institutions require long track records and large fund sizes so their investment doesn’t take more than 20% of the round. 

You can now take your expertise and run your own fund.


Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
-----
For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group