LP Michael Kim on Why He Doesn't Like Special Deals

This podcast episode explores various topics in the venture capital industry. It discusses the impact of increased competition on venture returns and the changing composition of seed rounds. It also highlights the historic performance of Cendana's investments and the potential of secondary markets. The episode delves into the growing trend of secondary activity and the emergence of secondary firms, as well as the advantages of operators transitioning into venture capitalists. Additionally, it examines the challenges faced by individual investors in building a portfolio in the current investment landscape and the expectations and demands from venture fund managers in negotiations with institutional LPs. Takeaways • Venture is a long game and it takes time for companies to become valuable. • Transparency and education are important in the industry. • Seed rounds have changed, with larger investments and higher valuations. • Secondary markets provide liquidity and offer potential opportunities. • Operators transitioning into venture capitalists bring unique advantages. • The abundance of seed funds presents challenges in portfolio-building. • Institutional LPs reduce commitment sizes and allocation to VC due to the denominator effect. • Negotiating fair and balanced terms is crucial for partnerships between LPs and venture fund managers.