20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja
This podcast episode provides a comprehensive overview of various aspects of venture capital. The speakers discuss topics such as portfolio construction, pricing and fund management, and managing the business side of a VC fund. They also share their fundraising experiences and strategies, including check sizes in different stages of fundraising. The speakers highlight common early-stage investing mistakes and emphasize the importance of promoting diversity in the VC industry. They discuss the impact of internship programs and the significance of deal memos in investment decisions. Additionally, the speakers encourage rethinking traditional criteria for LPs. Throughout the episode, the speakers draw on their personal experiences, challenges, and strategies, offering valuable insights and guidance for navigating the venture capital landscape.
Takeaways
• There are three main approaches to portfolio construction in venture capital: concentrated portfolio, diverse portfolio, and spray and pray approach.
• Balancing diversity with ownership targets is crucial for fund success.
• Fund size and desired ownership determine the focus on reserves planning and fund allocation.
• Pricing is important, but its significance varies depending on the fund size.
• Effective fund management involves managing various business aspects, GP commits, and open communication with LPs.
• Fundraising journeys can be challenging and time-consuming, requiring dedication and strong partnerships.
• Leveraging existing LP relationships and being targeted in reaching out to potential investors can be effective fundraising strategies.
• Minimum and maximum check sizes should adjust over time as the fund progresses.
• Taking risks, learning from experience, and continuous improvement are essential in early-stage investing.
• Scale, diversity, and representation are significant in creating change and tackling the wealth gap in VC.
• Internship programs contribute to the development of diverse investors and spread the culture of diversity and inclusion.
• Deal memos provide clarity, validation, and efficient communication in the investment decision-making process.
• LPs should reconsider traditional criteria and take more risks on GPs to drive innovation and inclusivity in VC.