venture capital fund investor presentation

Top 11 Venture Capital Pitch Decks

Healy Jones blends his venture capital experience with operational knowledge to support startup financial strategies. With a background in investing in over 50 startups and holding executive roles in VC-backed companies, Healy has been featured in major publications like the New York Times, Wall Street Journal, and TechCrunch. His efforts at Kruze have been crucial in helping startups collectively secure over $1 billion in VC funding, showcasing his ability to effectively navigate financial challenges and support startup growth.

A big part of my job at Kruze is to help our clients prepare to raise venture capital. So I’ve seen a lot of venture capital pitch decks recently. As a former VC who also has been an exec at a number of startups that have raised quite a few million in venture financing, I have some strong views on what information VCs want to see. And because Kruze clients raise over two billion dollars in venture funding annually , I get to see a lot of what works - and what doesn’t. 

Since I’m regularly being asked for a template for a venture pitch deck, I thought that I’d compile the best templates available on the internet that I know about. Again, I’m strongly biased, as I’ve seen many companies successfully raise and some not. These are investor pitch deck examples that I think are working.

In addition to the example presentations below, I also lay out the standard slides that I’ve seen companies use to successfully raise venture funding. You can scroll down to also see a TechCrunch interview with a Kruze Client, DeepScribe, where the founder and their investor walk you through the deck they used to raise a $30M round. Finally, I’ve added in a dozen+ questions that VCs often ask founders during the pitch (I’ll probably create an entire article around VC questions and answers).

We’ve released our free startup pitch deck course ! It includes 2 free Google Presentation templates that are free to use, and one downloadable financial model template - plus over 8.5 hours describing what VCs look for on every slide in the deck.

Again, the pitch deck course has two free templates  that are free to use. No email or registration or anything - just click the links, open the Google Slides and duplicate them into your own Google Drive. One of the free templates is a B2B example, the other is a B2C example. Haje Kamps, the well known TechCrunch writer who produces the pitch deck teardown series, helped me create those free templates - so get them!

Top 10 11 venture capital pitch deck templates on the internet right now

• Guy Kawasaki’s pitch template -  https://guykawasaki.com/the-only-10-slides-you-need-in-your-pitch/  This is the OG demo pitch deck. Short and sweet. Starting to get a bit long in the tooth, but still the first one to check out because it will highlight how simple and short can be better (don’t make a 30 slide deck!!)
• Ycombinator’s slide template - https://blog.ycombinator.com/intro-to-the-yc-seed-deck/  The actual deck that YC links to (it’s a Google Slide file) has such poor design, I wouldn’t recommend using it. HOWEVER, the order of slides and the topics are 100% on, so it’s worth carefully reading the commentary in the actual post. I like the final slide, as it clearly outlines how much funding is needed and the use of the funds. A solid slide to end the conversation on. 
• First Round Capital’s deck - https://www.beautiful.ai/blog/uber-vc-pitch-deck-presentation-template  One of the top, East Coast VCs supposedly had a hand in creating this one, and the slide order/content is one of the best examples of what to put into your deck. I don’t know how you actually download this - it’s in some kind of a proprietary format, but if you are looking for a view on how to order and design a pitch deck, this is one you must check out. 
• Series A pitch deck used by Front to raise their A  - https://medium.com/@collinmathilde/front-series-a-deck-f2e2775a419b   This founder very kindly shared their slides and fund raising experience. Great example of a competition slide in an industry that has a lot of legit competitors. 
• Airbnb’s seed deck - https://www.alexanderjarvis.com/airbnb-seed-pitch-deck/  This is a classic (although the visual design did not age well). If you are looking for a consumer deck or one that talks about how to launch into a new(ish) industry, this is worth looking at.

We’ve also put links to six other examples below, like the Uber deck and the Mattermark slides. Scroll down to see more real-life examples, and dig into our commentary on slide order and content strategy. 

Slides in an example Investor pitch deck

The professionals (like YC and Guy Kawasaki) are suggesting 10 slides in a standard pitch deck. I think the real point is that you should be able to deliver your pitch in 15 minutes or less - and if pressed, do a 5-minute pitch. That’s really short.

Why so short? Aren’t most VC meetings scheduled for 30 minutes? Well sure, but… 

Assume that your VC is late to the meeting by 5 minutes (they will always say something like “something came up with a portfolio company’s acquisition, but the truth is probably that the barista messed up and gave them an almond milk latte instead of a soy milk one and they had to wait for the right beverage - kind of a joke.) The VC will probably then give you a few minute spiel around what makes their fund different. Then assume that you need to answer at least 5 minutes of questions if your pitch is not going well - and 10 minutes of questions or more if the investor is engaged. And you’ll need a 5-minute pitch, that isn’t rushed, if some important partner is running way late or misses the first 20 minutes of your 30-minute meeting. 

The standard table of contents in a good pitch deck is:

Based on the $1 billion our clients raised last year in VC funding, we think you will want:

1. Cover/title slide - including the company name and the founder’s contact info

2. The industry’s or customers’ problem - the pain that your startup is solving

3. Your startup’s solution or value proposition - how your startup fixes the issue / the benefits you provide

The templates start to diverge, so a few different next slides are:

• Traction - metrics that show adoption or market validation or
• Product magic/product demo - showing off the offering
• Market size
• Business model / how you make money

6. Go to market/growth - explain how you are going to grow

7. Competition and or competitive analysis/advantages - all startups have some sort of competition, or there is at least a way that customers are currently dealing with the pain your startup is solving

9. Financial projections - include revenue growth, high-level spend, burn, and other KPIs like customer count (you can go deeper in an appendix or in a financial model). And if you are looking for a free downloadable model template, visit our financial modeling page .  

10. Summary:

• How much you are raising
• Traction if you haven’t already done so
• Use of proceeds (what you do with the money)
• Current investors participation level (if any - strong investors who have already invested in previous rounds and who are participating in this one are a very good signal)

I am slightly older school - I usually like an “executive summary” after the cover page that goes over the company and round. I think this is probably a page that went out of style in 2015 or so, but I still like it because it quickly helps the VC see what your key metrics/sales points are, and how much you are raising. I usually recommend only four or five bullets on this slide:

• Disrupting the $x billion industry
• 1,500 customers using product [or] Marquee customers include McDonalds and Marriott
• ARR of X, growing 20% month over month
• Team has deep domain experience from XYZ
• Raising $8 to $10 million Series A

Given that YC and Guy Kawasaki seem to no longer (or maybe never) had an exec summary at the front of their venture capital pitch deck templates, you are probably OK ignoring my advice and just getting straight from the cover page to the problem statement. 

Tips for your slides

Here are some of the slides that we mention above and some tips that founders we work with have found helpful:

• Problem Slide - Invite the investor into discussing / discovering the problem with you. Some problems are obvious - but that doesn’t mean that the VC has thought about them deeply before. Help the investor understand the issues from the eyes of the buyer/consumer. The best venture capital pitch decks have problem slides that are strong enough to make the investor really, really want to meet with you. 
• Go to Market / Growth Slide - For companies that are already generating revenue and growing, show that you know who your customers are and where you can find them. For pre-revenue startups, use this slide to prove that the founders have 1) thought about how to sell the product and 2) have a plan on what you will try to prove vis a vis your sales and marketing with the capital you are raising. 

Seed Pitch Deck Outline

Our COO, Scott Orn (also a former VC) has been assisting a number of seed and pre-seed companies during their fundraises, and has produced an outline/template for a seed pitch deck.

Pre-seed is sort of a new asset class. It’s essentially the first money in. That’s what seed used to be for everyone. So this is applicable to pre-seed and seed - basically, what to present when your company is more of an idea.

• Company’s slogan / 1 sentence elevator pitch - the first page or first slide should really just be the company’s name and slogan, or the one sentence, what you are doing. And just get the audience focused on that. Make sure to make an impression, deliver it with passion. You are in sell mode here. You’re pitching investors. 
• Problem - what are your customers struggling with? A lot of investors like the problem-solution type of framework, so the next slide would be the problem. So talk about how your potential customers are suffering, what’s going on right now in the market, why it’s not working, and then the next page in the deck will be your solution.
• Solution - how are you going to make everyone’s life better? You can explain how you’re going to be better, how you’ll save your clients or customers a ton of time, a ton of money, etc. Better, faster, cheaper is a Silicon Valley slogan that people typically use when explaining their startup’s solution.
• Nothing is more powerful than a demo. That also shows that the company has actually built something and you can get a taste for it. 
• Often you see a screenshot of the demo and often can click for video.
• Some people like more visual depictions of what you are doing. Regardless, in this section, something visual is pretty helpful. You want to get the conversation going, you want them to react to something, you want them to feel vested in what you’re doing. Get them to buy into the solution.
• This is kind of a “check the box” because it’s always hard to size the market. 
• And many of the best companies look like they have a tiny market but turn it into something huge. 
• But it’s a good exercise and tells investors where you are going. And, remember, venture capital is really just wanting to invest in big opportunities. VCs are okay with some losses, but when something works, they need it to be big. And so that’s why they really care about market size. This section helps prove to the seed investor that you are pointed at a big possible market, and that you are aiming to make a big company vs. a nice, small, lifestyle business. 
• You would be surprised at how many small businesses, that never really anticipate getting bigger than a couple of million in revenue, try to raise seed financing. So the seed investors need to be able to weed out the entrepreneurs who are not focusing on big opportunities, and you do that in this part of your seed pitch deck.
• And if you’re willing to spend a bunch of your time, five, 10 years of your career on something, there better be some size to it!
• You want to identify competitors. If you pretend you don’t have competitors or bad mouth them, you’ll lose credibility. investors typically like you to acknowledge your competition. And oftentimes there’s a little bit of education, because you know this market really well, but the seed investor doesn’t, so here is where you teach them about the competition.
• Seed investors know that competitors aren’t the end of the world. In fact, the best venture capitalists actually LIKE successful competitors, because it helps validate that there is a market for the solution. 
• This is a super important slide. Are you using a sales team? Partnerships? Online marketing? Events?
• Creativity, different approaches and things that investors have seen work are great.
• How much money do you need?
• How long will that get you?
• When do you think you’ll start to generate revenue.
• A visual is really good as part of this slide.
• It’s important to understand the seed investors mindset on this slide. They are doing the math, and they’re thinking, what does this company need to raise money from a series A venture capitalist? Because really, at every step of the venture capital game, people are putting money into your company and then hoping other people will step up down the road to fund the company. The seed investors that you are pitching only have so much capital. They are going to rely on your company doing well enough, and looking strong enough, to be able to get a VC to invest in your next round. And so, they’re doing that math and trying to figure out what is going to be that milestone that really brings other venture investors in the company? 
• Some seed investors don’t want you to talk about a sale eventually. They are essentially saying “I don’t want to even hear that you’re thinking about selling the company in three years or four years, or how could you possibly know who’s gonna buy it?” Which is very fair. So you needed to kind of tread lightly on this. I think the way I typically like to do this is just point out the players in the market and make the point that if you get traction and you’re successful, these people or these companies are gonna have a real strong vested interest in acquiring you. And so that’s kind of enough. 
• It’s enough to say that if we hit traction, there will be a lot of interested companies like X, Y Z.
• You don’t need to say like “I’m going to get bought for X number of dollars in year three” or something like that. Just talking about who could buy you or who would be interested is a delicate way of doing this. 
• It’s always great when a founder says, “I’m taking this through IPO. I’m committed.”
• Note from Healy: While Scott may really like this slide, I don’t love it as much, because, as Scott mentions, it makes me afraid that the CEO is not in it for the long term. I usually prefer to discuss this on the competition slide, “here are other, very big companies, that don’t play in this solution but who have the same customer base as we want… they may get into our market. Who knows, they may acquire their way in once they realise the solution is being adopted.” I like that method better, as it doesn’t imply to the seed investors or the VCs that you are putting the cart before the horse, instead it says that you know who the heavy hitters are in the general market, and then the investor can do the mental math to think that they may want to buy their way in eventually.
• Team - some people like to put this way up in the front, right after the slogan and what they’re doing, because they have a team that has accomplished a lot and the team is backable just because they’re just so successful and so technically strong and know what they’re doing. But you can have it here at the end of the presentation, either way is fine. It’s good to get some bios up there, get some pictures so that people can identify. Also the nice thing about bios and your founding team in the slide is that oftentimes you can play the name game with venture capitalists or seed investors - they’re professional networkers, they know a lot of people. And so oftentimes, you can get to a point where they know someone that’s on your team or that you know, and that’s a really great background diligence channel. If they want to invest in you, they may actually call their friend who knows someone on the founding team or knows you and just check and see what kind of person you are or your team is just for diligence sake. It also can be very impressive if it’s a super strong technical team or a marketing team that’s gone to market in a really unique way. But, wherever you put it in the pitch deck, definitely have a team slide.
• Any examples of progress - this is huge. If you can say you already have clients, revenue, etc, it is much more convincing. All these signs that what you are doing is working, and that it’s legit and it’s something the seed investors want to be a part of, it’s a social proof type of thing if you know that from influence. And so showing your traction is probably the best thing you can do to sell the company. So don’t hesitate to do that. If you have a commitment from a lead investor, that’s great, always put that in this slide in your investor pitch deck because it’s a lot easier to follow on than be the lead and set the evaluation, write the check, that’s a lot of responsibility and sometimes people don’t want to do that. But that’s what you can end up with.

And then there’s a tiny little tip which is, oftentimes you get to the end of the presentation and that slide just sits up there for the remainder of the pitch discussion. If it’s going to sit there, just make it like something showing how awesome you are or helping you close the sale, maybe it’s pictures, maybe it’s graphs or your traction. Instead of having that boring, “questions” slide, do something that spices it up. And every time they kind of subconsciously look at the slide deck on the wall, or the presentation, even though you’re just talking after the presentation has been done, it can kind of help convince them in a small way. So just a little tip to help your investor pitch deck be a bit stronger at the end.

At the seed stage, you’re still living the dream and you’re convincing investors that they should come along. So it’s a little less finance, a little less metrics and more vision. But really this framework should work for any type of venture capital presentation.

How to write a pitch deck to raise funding

Ok, so you’ve now seen the VC and seed deck outlines above - but how so you actually start writing a presentation that will help you get funding? Here is how I have successfully written pitch decks when I was raising VC money:

• Understand WHY you’ll be able to raise funding - this could be your traction, the market, the team, the product strength. Find the one thing that will blow investors out of the water, and build your story around it.
• Now that you know what your biggest strength is, put together the outline of the deck. 
• Decide what the one major takeaway is for each slide - this might be the slide title, or it might be a point driven by an image or chart. But you only have a handful of slides, so each one has to drive the vision forward; make each one count. 
• Start from the strength slide; don’t get it perfect yet, just make sure it highlights the “wow.”
• Next, fill in the rest of the slides, remembering that you are selling your vision. Use data, market insights, customer quotes to support the conclusion that your company is going to be successful.
• Now, practice running through the deck. It sounds cheesy, but I recommend doing it out loud! Make improvements to the slides and flow based on how it sounds delivering it to yourself. 
• You are ready to practice on some “friendlies” - either current investors, partners, mentors. Get their opinions, and then iterate the pitch deck until you feel confident that you’ve got the story down. 

Tips for your fund raising presentation if time is running short

Ok, so as I outlined, it’s highly likely that your 30 minute conversation gets cut into a much shorter time frame. There are good ways to handle this and bad. The worst way that I’ve seen is when a CEO talks REALLY REALLY fast and blows through the preso. It’s hard for anyone to soak in the information, it can be hard to understand, and it usually doesn’t work. A better way is to have the 5 minute presentation ready to go, and then to just walk through that briskly. No demo, and try to answer the VC’s questions as quickly as possible.

Common mistakes founders make crafting their investor pitches

In the Kruze pitch deck course, I talked with renowned pitch deck consultant and author, Haje Kamps, about some of the most common mistakes we’ve seen founders make over and over when they present to potential investors. Here are some of those problems - and you can watch the entire video. 

• Making the Team Slide Weak : We’ve noticed that many founders often inundate their team slide with unnecessary information, such as a full organizational chart, instead of focusing on key members and demonstrating their relevant skills for the specific startup. Don’t overload it; you don’t get points for lots of logos. Instead, figure out the most relevant or impressive items and 
• Misunderstanding Market Size : The total addressable market and serviceable markets need to be sizeable enough to show potential for a venture-scale company. It’s fine to start in a niche, but you need to be able to create a company that’s worth at least a billion dollars, if not more. As you need to be attacking a big space.
• Unrealistic Projections : We’ve seen founders showcasing either slow, steady growth or overly aggressive, unrealistic growth - both extremes are unappealing to investors. Look at some of the templates we share on this slide - those projections are good! You aren’t going to go from founding to $100 million in revenue in a year. And if you are growing from $4 million to $4.5 million in revenue, congrats, you’ve got a great small business, but it’s not venture-scale. 
• Failing to Accurately Represent Traction : A traction slide should provide substantial evidence of growth, often in the form of customers generating revenue or being in the sales funnel. Unfortunately, many founders include markers such as press coverage or vague “interest” that doesn’t translate into tangible growth.
• Lack of a Coherent Story : Haje really talks to this well. It’s essential for founders to weave a coherent story that sells not just the product, but the vision of the company and its future value. Many founders fail to communicate this effectively, resulting in a disconnected or confusing narrative. You want the partner who you just presented to to be able to walk off and talk about one of your main customer successes, and how that ties into your company’s vision and traction. 
• Absence of a Competition Slide : Many founders overlook the importance of including a competition slide in their presentation. This is a major mistake, as not acknowledging competition can lead investors to think the founders are unaware of their market landscape. It’s one of my favorite slides. If you’ve got big competitors, great, you’ve just helped the VC understand who you might sell the company to in a few years! 

That’s just a few of the top venture capital pitch deck fails we go over in the video - check it out. Being aware of these common mistakes and addressing them in your pitch deck can significantly enhance your chances of capturing a venture capitalist’s interest.

Common VC Pitch Deck Fails Video

Tips for the financial section of your pitch deck

As financial advisors to funded startups, we tend to overly index on the financial section of our client’s fundraising pitch decks. Note that this is our interest area (and how we get paid), so it may or may not be all that interesting or important for your startup’s presentation. 

The financial detail that you go into in your VC deck will vary based on the stage of your business. So, let’s breakdown what you might need for a seed to Series C company.

• Seed stage - Your pitch deck only needs a brief description of what you are intending to do with the money. As Scott mentioned above, a visual can go a long way here. Since revenue is now often expected for an A, you should articulate some sort of an expectation in revenue before the money runs out (i.e. investors want to know if you’ll have the exit velocity you need to raise the next round).
• Series A - A 5-year view is ideal, as this gives you the chance to show / “prove” that you are going to create a venture scale business. An extrapolated income statement with include revenue growth, high-level spend, burn, and other KPIs like customer count. You ought to have an appendix with more detail - or just a piece of excel that you can share (probably better at this stage).
• Series B - You are still going to need the 5-year projections. But, at a B, you’ll have more financially minded investors. This means that you ought to have a real appendix section that gets into the drives and assumptions to your continued growth. SaaS companies are going to need to be able to explain how they calculate their LTV to CAC - so your pitch deck will have to address both parts of that calculation. You can still put the detail in the appendix, but have it organized so that you can go through all the financial part in an organized presentation if needed. 
• Series C - Series C companies should have real financials that have been prepared by a professional accountant, either in house or as a consultant. While you’ll still want a single slide in the meat of the pitch deck that has your five year vision, your historical results will also matter - so that slide will have to do a lot. This may mean that you have to push your KPIs like customer count into a seperate slide(s). And the financial appendix should have historical statement - probably all three - and projections. 

Finally, we’ve complied some other pitch deck examples that you may find helpful. Again, we think the best VC pitch decks templates/examples are the ones we highlighted at the top of this page, but here are some of the others that are floating around on the internet that you may like.

Five SIX More of the Best Pitch Deck Examples

• Uber ( pitch deck here ) - this is when they were still called “UberCab.” And it’s very early in the life of the company, so is product and market focused. You won’t find data about the company’s performance, since it’s so early. This deck may be helpful to pre-launched startups.
• Intercom ( seed pitch deck here ) - another example of a seed stage pitch deck, this one for when Intercom was raising $600k. This is a short deck - only 8 slides - and it focuses on the team, problem, solution and market. Note that the “progress” slide consists of a tweet from a user - pretty slight - you may not be able to get away with this lightweight of a presentation unless you have the clout of these founders. BUT if you are looking to talk about the market size and opportunity, this is a decent example.
• Mattermark (deck here ) - data company Mattermark has real traction, and there are several examples of solid metrics/charting visuals in this deck. With $1.5M in ARR at the time of this pitch, they are probably around where many Series A’s are getting done in Silicon Valley. (I’ve even seen Series B’s happening at this level). This is a great pitch deck example if you are looking to impress the VCs’ with your traction. Check out slides 11, 12 and 13 for information on how to present historical revenue growth, projections and customer industry diversification. 
• Mixpanel (deck on slideshare here ) - Mixpanel shared their deck as an example that other startup can use. This is the set of slides that Mixpanel used to raise a $65M round. The competition slide is particularly good for driving a disucssion with the VCs. The traction slide is also strong - one of the best in combining the visual “up and to the right” chart with some details on the company’s milestones. The slide that is close to the “what we do with your money / operating slide” is a good overview of what the company needs to do to grow, although it’s not as focused on financials as I’d like. 
• Mint (seed pitch deck here ) - A great seed stage fundraising deck, with the whole enchilada: a good team slide, a great market size one, solid competition, user acquisition, and a financial slide that makes my inner accountant happy. Notice the flow on this slide, with the team slide right near the front. This could be the best template/example for companies with an experienced team.  
• Orange (seed pitch deck template here ) -  A great example of a hardware as a service deck. It gets into the problem, the market size, the solution and then makes a solid case for why this team is the one to solve it. One of the best parts of this one is the intro slide - it kicks off right at the front with a strong explanation of what the problem is, and the VC looking at it can immediately infer what the startup’s solution is. 

So that makes 11 of the best pitch deck templates and examples that we’ve seen on the internet. 

Pitch Deck Example from a Kruze Client

One of our clients, DeepScribe , was interviewed on TechCrunch Live about their Series A fundraising process. Akilesh Bapu, the CEO and co-Founder of DeepScribe, was interviewed along with Nina Achadjian, a VC and Partner at Index Ventures. Nina invested $30 million into the company, and was impressed with the founders and the story they explained during their pitch.

In addition to giving Kruze Consulting a shout-out for our help on his accounting diligence (thanks Akilesh!) he also walks through part of his VC pitch deck. It’s one of the better examples that we’ve seen of a live pitch deck presentation. You can watch on Youtube or see below.

What Questions do VCs ask During a Pitch?

Questions during a pitch are a GREAT sign - that means that the venture capitalist is paying attention. I strongly recommend founders use their venture capital pitch deck as a crutch, jumping to the right slide to answer the specific question , then going back to the original presentation order to make sure all important topics are hit. Again, I’ve seen partners reject a company because “the founder didn’t talk about go to market.” Yeah, they didn’t have time to talk about it because of all of your questions! 

Here are some of the trickier questions investors might ask during a presentation. Think about which slide you might be able to use to answer these questions. Resist the temptation to argue with a VC if they ask difficult questions; saying you don’t know but then laying out your plan to figure it out is a great response to many questions. 

Questions VCs Ask

• What’s the backstory?
• Tell me about yourself 
• How did you meet your cofounder?
• Tell me about the team? How did you find your first hires?
• What is the specific problem you are solving?
• What’s the key insight about your user that led you to build this business?
• What’s the ideal outcome for your customer?
• How are customers currently solving this problem, before your product/solution existed?
• What differentiates your solution from alternatives?
• What have your biggest learnings been so far?
• How are you planning to acquire customers?
• What would your customers say about your solution, and how would they react if it went away (i.e. you went out of business)?
• Why now? What has changed in technology or the market that makes this possible only now?
• What do you think has to go right for this to be a massive outcome?
• How much do you want to raise, and what milestones do you hit with that capital?

VC Pitch Deck FAQ

Because Google says people are asking questions.

What is a VC pitch deck?

A VC pitch deck is a presentation (typically in Powerpoint, Google Sheets or PDF) used to explain a startup idea to potential venture capital investors. A pitch deck contains information on the business, the market and the company’s traction/financials. 

What is a pitch deck used for?

These presentations are used to 1) convince venture capitalists to take a 1st meeting with the founder(s); 2) begin investment due diligence and 3) convince the venture firm’s partnership to want to invest in a startup. 

Will a deck help you get a meeting with a VC?

A great venture capital pitch deck may help you get a meeting with a venture capitalist. VC firm NFX reminds startup founders that investors are looking for the following 12 data points before taking a meeting with a startup:

• Company description
• Market opportunity
• Business model (how you make $ + your financial projections)
• Geography (less important post COVID)
• Team size (FTEs)
• Timing of the fundraise
• Company traction
• Fundraising history
• Fit for the specific VC
• Referrer - who introduced you to the fund

Does your venture capital presentation have to be PowerPoint?

VCs typically expect a slide deck; these days usually a PowerPoint, Google Slides or a PDF of one of those formats. I’ve been with companies that have used designers to create an incredibly slick venture capital presentation, which they presented as a PDF - no idea which tool was used to actually design the presentation, but it was likely an Adobe product. The most important thing is making the presentation be in 1) slides and 2) something they can share and access from their computer.

Is it OK to share your venture capital presentation by DocSend or a presentation sharing platform instead of as an email attachment?

These days more and more VCs are Ok getting the presentation as a DocSend or other presentation sharing platform that asks for their email address or asks to verify that they are someone you to share the document with. However, you’ll occasionally find the grump VC who wants their presentation the old school way. Often these investors write up their dislike of sharing tools on their blog or Twitter. 

How do you modify your pitch deck for the final, all-hands VC partner pitch?

The final step to getting a term sheet, at many venture capital firms, is to pitch the partnership one final time. This is after you’ve already gotten one of the partners to support your investment internally as the champion. In the final meeting, you’ll have the full range of understanding of your company - from the partner who is supporting you and who knows a ton to partners who know close to nothing. 

It’s not safe to assume knowledge on your industry or problem. Invite all the partners into the fold by explaining and building excitement around what you are doing. Don’t gloss over the market size or competition! 

Hope this helps you find a good pitch deck template for your fundraise!

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• Venture Capital

7 Steps to a Venture Capital Fund Pitch Deck

How vcs raise capital.

With the ever-increasing challenges facing Venture Capital (VC) Funds, getting investors to partner with your firm can be a daunting process.

Despite the challenges, a fund manager must constantly reach out to new investors to help them meet their firm’s investment needs.

Besides, the fast-evolving business landscape requires VC funds to be on their toes, especially on technology matters. Even if you have a fairly-profitable firm, you may still need an additional capital injection, once in a while, to cater for expansion, system upgrades, among other emerging needs.

For this reason, mastering how to create persuasive venture capital fund pitch decks can go a long way in simplifying the investor-sourcing process. Essentially, an excellent presentation should provide an overview of your strengths and a bold statement of why your firm is the best place to invest for a high return on investment (ROI). Doing this raises your chances of grabbing investor attention and securing a second meeting .

If you’re wondering how you can achieve this, here is a rundown of seven essential steps to follow when preparing the investor pitch deck.

Venture Capital Fund presentation development and design by Launch Module Media.

Ready to get your Pitch Deck working for you?

Prepare a company overview.

A company overview is an opportunity to highlight crucial details about your firm. It gives the investor an inside view of the fund and lays the foundation for your presentation. Done well, it can hook a potential partner from the get-go and lead to better reception of the other sections.

Start by briefing the investor about who you are, what you do, and why you do it. Remember to throw in figures, like your fund size, average investments, among other key firm metrics. As a rule of thumb, ensure you weave the overview within a captivating story that smoothly connects with the presentation’s ‘why.’

Draft an Investment Thesis

Summarize your investment model, highlighting your strengths and market position, then explain how these give you an edge over the competition. Discuss anything spectacular about your investment strategy, as this will add more credibility to your fund. Likewise, mention how you go about sourcing and evaluating investment deals.

Investors focus more on the investment thesis  to gauge whether investing in a fund is viable . Hence, do your best to create a strong thesis that’s hard to ignore.

Outline the Fund Structure

In this section, analyze your fund figures to give the investor a clear picture of the firm. Elaborate on the investments, then provide an estimate of the amount you require to perform optimally.

You may also include the expected return on investment (ROI) to let the investor know their investment will be worthwhile. Finally, ensure you use graphics and illustrations to break down the information and make it easier to understand.

Provide a Fee Structure

In investment language, a fee structure is a schedule outlining the investor’s  financial obligations to the firm . In most cases, the carry and management fees are set at a standard rate of 20% and 2%, respectively.

However, a firm is at liberty of setting higher rates, so the fees can be higher than usual. As such, an investor would be interested in knowing your carry and management fees, so arm yourself with this information.

Boost investor confidence by highlighting your VC Fund’s performance.

Talk About Your Performance

Your firm’s credibility can significantly influence the success of your venture capital fund raise. One key indicator of your credibility is an impressive track record. Ensure you give a brief of the  firm’s performance metrics , highlighting any strategies you may have used that have resulted in a good performance.

Include parameters like internal rate of return (IRR), fund status, etc. The importance of doing this is that it boosts the investor’s confidence by acting as a testament to your firm’s profitability.

Another way of proving positive performance is by highlighting your portfolio. Here you can talk about their success stories, then demonstrate how your investment fits into the picture. But ensure you get permission from the funded businesses before disclosing their details.

Again, ensure you summarize this information in graphics and charts to enhance understandability.

Discuss the Market Opportunity

By taking an interest in your venture capital fund pitch deck, an investor wants to know more about the market you’re serving. Mention your existing market, and give a preview of any untapped zones. Most importantly, talk about the strategies you intend to use to reach and influence the under-served market.

You can also comment about your competitors and how you have differentiated your fund. Then discuss how you plan to harness the market potential to gain an advantage over the competition.

Demonstrate Your Expertise

This step should crown your VC fund raise drive. As an opportunity to show the investor why your firm has the best team to partner with, it can significantly enhance your firm’s credibility.

Include profiles of your general partners, as well as limited partners’ portfolios. Mention their unique expertise and how each impacts the firm’s performance. Doing this can improve your brand perception and pave the way for you to raise more capital.

Bring the story of your VC Fund to Launch Module for an expert presentation.

Getting financiers for your venture capital fund can be challenging. However, securing external financing, from time to time, is essential for the smooth running of your firm. For this reason, you need to be constantly on the lookout for new investors to partner with. One sure way of getting the investors interested in your fund is by arming yourself with a compelling presentation whenever the situation calls for it. Among other things, your venture capital fund pitch deck should amplify your strengths, as well as provide a bold statement of why your firm is a great investment opportunity. Essentially, you can achieve this by following these steps;

• Prepare a company overview
• Draft an investment thesis
• Outline the fund structure
• Provide a fee structure
• Talk about your performance
• Discuss the market opportunity
• Demonstrate your expertise

Armed with a compelling presentation, you can ‘venture’ out confidently and bag those high-value investors you wish to reach. Otherwise, if the process of preparing your investor deck sounds hectic, we can shoulder the burden for you by creating it on your behalf. We have helped both big and small brands create persuasive presentations that grab investor attention. Call us now at 844-200-6160, or fill out our contact form  to get started.

About the author

Leslie Morales is the CEO of Launch Module and a Certified High Performance Coach. Learn more about Leslie and her team on our About Us page.

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Investor presentation: the guide for fund managers.

Raising capital is no easy feat. It takes more than a promising thesis – pitching potential LPs calls for a carefully planned out process that identifies, pitches and engages the right targets. One of the most powerful tools within this strategic process is your investor presentation. The truth is, the quality of your investor presentation will absolutely make or break your successful capital raise. 

That’s why we’ve compiled our most valuable insights into crafting a winning investor presentation. Read on to find out the key elements of a strong capital raising presentation and best practices for an effective presentation that wins investors.

Raising Capital For Your Fund – A Quick Overview

The very first step of raising capital from investors is communicating the right investment thesis. Your investment thesis should fully align with your interests and expertise, whether that is: 

• Distressed Companies
• Sustainable Energy
• Infrastructure
• Alternative Lending
• Consumer Goods
• Emerging Markets

Once you’ve identified your thesis, you’ll need to spend sufficient time researching suitable investors or limited partners (LPs) to approach. It's crucial to target investors who share your investment philosophy and have past investments in your area of focus. 

Securing an anchor investor early on can be a game-changer for your fund, providing you with the necessary credibility to attract additional suitable investors. A strong first closing will significantly help you build momentum and keep going with your fundraising efforts. Use the first closing accordingly, to remind investors you already had contact with or reach out to new potential LPs.

The next step is making your first capital allocations, i.e. by identifying and acquiring attractive target companies,  thereby demonstrating proof of your investment thesis to help build investor confidence. We recommend that you continue to promote your fund until the final closing, and use each closing and investment to generate further attention and momentum. 

Why You Need A Solid Investor Presentation

A solid fund presentation is a critical component of any fundraising strategy, for startups and funds alike. It serves as an important marketing tool to help you effectively communicate your investment opportunity to potential investors. 

In today's world, it's easier than ever to get a first introduction to potential investors thanks to remote communication tools like Zoom, or Google Meet for example. Hopping on a call is much less of a commitment, than having long sessions in the office.  The downside, however, is that investors are hearing fund pitches more than ever before . 

To stand out in this increasingly crowded market, your investor presentation needs to be well-crafted, informative, and engaging. It needs to strongly communicate your investment thesis, show the comprehensive experiences of your team, financial projections, and define a clear exit strategy in a concise and focused manner. 

But how exactly do you do that? Let’s find out! ⬇️

The Key Structure of a Strong Investor Presentation

1. introducing the fund and the investment opportunity.

Firstly, you have to introduce your fund . The main purpose here with this is to provide investors with a clear and concise overview of your fund. Your introduction should emphasize the unique selling points of your investment opportunity, like a potential for high returns, low risk, or access to a specific industry or market.

2. Explaining the investment thesis

Subsequently, you will need to provide further details of your investment thesis. Your investment thesis must clearly articulate your investment philosophy, including the specific types of companies and/or industries in which you plan to invest, the types of returns you seek to achieve, and any other factors that influence your investment decision-making process in detail.

It's also important to highlight how your investment thesis aligns with current market trends . Including in-depth market knowledge will help investors understand the relevance and potential of your investment approach and confirm your profound understanding of respective the market environment.

3. Market analysis and market opportunity

Providing a comprehensive market analysis helps investors in understanding the broader market landscape and any potential opportunities and challenges accordingly. 

Your market analysis should therefore include a detailed overview of the market size, growth potential, and competitive landscape, as well as any regulatory or policy changes that could have an effect on your fund in the future. 

Your clear objective is to ensure that your investors are confident and convinced that you have a profound understanding of the respective market dynamics .

4. ESG Ratings and KPIs

ESG ratings (Environmental, Social and Governance risks) and KPIs have gained significant importance in the private equity industry, with investors placing more emphasis on sustainable investing. 

Therefore, you need to include information on your fund's commitment to ESG principles and how to measure and report on your ESG performance accordingly. Providing transparent and reliable ESG ratings and KPIs will demonstrate your fund's dedication to responsible investing and build confidence in potential investors to support sustainable investments.

Thereby, it is recommendable to focus on a limited selection of ESG themes that fit well with your thesis and respective market. This helps investors to trust in your focused ESG strategy. 

5. Team overview and track record

Investors look for private equity and venture capital funds with experienced and successful teams who can deliver outstanding returns . It is therefore of great importance to include an in-depth team overview and track record to underpin the team's experience, expertise, and successes in managing investments. Be prepared to provide one-on-one interviews with potential investors and selected team members to confirm the strong composition of your investment team.

6. Financial analysis and projections

Financial analysis and projections are crucial in any investor presentation, to demonstrate how you will generate strong returns for investors. Make sure you provide a detailed analysis of your fund's financials, including expense management, and a clear and transparent fee structure. This will demonstrate your commitment to fairness and transparency, and build trust among potential investors.

7. Exit strategy

A valid and profound exit strategy demonstrates when and how investors can expect respective returns on their investments. Therefore, a detailed overview of the exit options available, such as IPOs or strategic sales, as well as the timeline for these exits is inevitable to support your thesis accordingly.

5 Best Practices for Your Fund Presentation

You’ll need more than just an idea of the key elements to include in order to create a strong investor presentation. While the Fund Presentation has a unique Structure, the fundamentals that make your pitch successful are like in any other presentation.  Let’s go over 5 best practices for a successful presentation. 

1. Tailoring the presentation to your audience

First, it’s essential that you tailor your presentation to your specific audience. This means understanding their priorities, concerns, and areas of interest, and customizing your presentation to address these factors directly.

2. Keep the presentation concise and focused

It’s a good idea to keep your presentation concise and focused. Avoid unnecessary information or tangents and focus on the key elements that will help make your case to potential investors.

3. Use visual aids effectively

Using visual aids effectively, such as infographics or charts, can help make your presentation more engaging and easier to understand, which can increase the likelihood of securing investment. Use graphics sparingly though, so your presentation doesn’t become crowded. 

4. Share additional resources

Use a data room to share additional resources for later review. They can review the information at their own pace and get a more detailed understanding of your investment approach and financial projections.

5. Review and Optimize 

Seek feedback from trusted advisors, and refine your fund presentation after each pitch. Make it more persuasive and effective in securing investment - one investor at a time.

Creating a strong investor presentation is crucial to raising your private equity or venture capital fund. A winning presentation should:

• Introduce your fund and investment opportunity
• Explain and underpin your investment thesis
• Provide comprehensive market insights
• Highlight potential opportunities and challenges
• Present your ESG ratings and KPIs
• Highlight your team's track record
• Provide profound financial analysis and projections
• Present your defined exit strategy

Ready to take your investor presentation to the next level and optimize your chances of securing your investment? Vestlane's Data Room maximizes your chances of success by obtaining full transparency on which documents investors are focusing on, supporting your efforts to tailor your presentation accordingly. Check it out now and start your journey to powerful investor presentations!

FAQ – Frequently Asked Questions

What should be included in a presentation to an investor.

Include elements such as an introduction to your fund, investment thesis, market analysis, ESG ratings, team overview, financial projections, and exit strategy.

What is the rule for making an investor presentation?

While there are no hard rules for making an investor presentation, best practices include tailoring the presentation to your audience, using visual aids effectively, and seeking feedback from trusted advisors.

How to do a good investor pitch?

Focus on telling a compelling story about your fund, emphasizing your team's track record and expertise, and demonstrating a clear path to generating returns for your LPs.

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How to Prepare a Killer Venture Fund Pitch Deck

Five Hacks to make your VC deck stand out to LPs.

Specialized pitch decks are required for venture capital funds that are in process of raising and closing on capital from limited partners.

The pitch decks have certain requirements, like proper legal disclaimers, and they also must comply with standards that limited partners have come to expect. Today, limited partners look at slides for less than a minute on average, so the purpose of each slide needs to be clear and the main points per slide need to tell a narrative.

Here are five hacks to help your venture capital fund presentation stand out with limited partners.

1. Reinforce Your Thesis

Write a one sentence Thesis, and then ensure that every point and every graphic on every slide reinforces that Thesis.

The point of the presentation is to explain how the fund is uniquely qualified to execute your fund Thesis. Tangential information can dilute or confuse the message. As a tactic, paste your one sentence Thesis in a small font at the top of every slide in your presentation, and then read or review everything on each slide to ensure that it matches the Thesis. For example, if your Thesis is for a deep tech fund, it does not make sense to put your high school lacrosse experience as a bullet on the Team slide.

2. Use Simple Slide Titles

Use common one, two or three word titles for every slide, and avoid being funny or creative with slide titles. 

Limited partners often look for specific information to confirm interest in a fund, since most LPs have investment criteria that they are looking to fulfill. By keeping the slide titles simple, it allows limited partners to find and focus on the information that they need. Common slide titles include Thesis, Team, Track Record, Portfolio, Market and Economics. Avoid slide titles that resemble phrases or sentences like, “how we have the best portfolio” or “our unique market knowledge,” since this can be confusing to limited partners about what is contained on the slide. For a full list of common slide titles and content, read on.

3. Keep the Slides Short

Avoid using more than 50 words per slide, using diagrams, pictures, charts or numbers to replace words.

The average limited partner spends less than one minute per slide, and our data shows that limited partners spend less time on slides with more words. Overwhelming a limited partner with a lot of information can cause them to skip the slide. Our experience shows that there should be one major takeaway point per slide that is reinforced with the content. For example, on a Team slide, if you have three Partners and you want to make the point about deep tech expertise, use bullets under the team members that show they are leaders in deep tech. For example, “Ph.D. Physics, Carnegie Mellon” is a good bullet, or “12 Patents in Robotics” is another good bullet. See how they are short?

4. Include Disclaimers

Add a legal disclaimer for the whole presentation in the front or the back, and disclaim and forecasting slides about forward-looking statements.

Short and appropriate legal disclaimers are normally required and help the general partner look more professional as a money manager to limited partners. The absence of disclaimers may make a credible limited partner suspicious. Most venture capital decks have one overall legal disclaimer for the jurisdiction that you are in, often placed in the back, and the forecasting slides normally have a footnoted disclaimer about forward-looking statements. These are usually secured by your attorneys to comply with local and regional fundraising laws. You can read some sample disclaimers below.

5. Test the Narrative

Read the whole presentation out loud in less than two minutes by stating the main point of each slide to refine the narrative flow.

Venture capital fundraising decks have a narrative flow that emphasizes why the fund is uniquely qualified to execute on the Thesis. This story can be told in many different ways depending on the strengths (and weaknesses) of the team and strategy. For example, a moderately talented team launching a fund in a market with little funding will likely find the best deals, so they can focus on describing how the “Market” is strong and growing. Quickly say out loud the main point of each slide to evaluate the narrative effectiveness of your presentation. Try moving the order of slides around to see if you can build a stronger narrative and create a better presentation flow.

These five tips will help to make a much more effective presentation for a venture capital fund. Remember that many limited partners still print out presentations, so avoid having color backdrops and avoid a lot of photos. Put your contact information on the title slide, version each release and include page numbers.

It is not uncommon for general partners to edit the fund presentation multiple times per week during the fundraising process. As the versions improve, the closing rate increases. Good luck!

Bonus: VC Slide Titles & Content

Below is a list of the most common slide titles and content in venture capital fund pitch decks.

• Title has a tag line, versioning and contact information for the key people pitching.
• Thesis just has your one-sentence Thesis.
• Team has up to three Partners per slide, plus additional slides for Venture Partners, Advisors or other key individuals involved in fund decision making.
• Track Record highlights one, two or three relevant deals that you and your Partners have invested in or helped to grow, including a logo of the company
• Value Add describes the value your fund will provide portfolio companies or investments, possibly with a diagram
• Warehouse highlights any deals that you have done or are planning to do with a logo of the company
• Allocation shows in a table the number of deals that you will do organized by stage with the estimated investment, valuation and ownership.
• Returns shows the type of returns that you anticipate from hypothetical portfolio companies organized by small, medium or large exits across three columns.
• Liquidity shows up to three projected fund outcome scenarios as a multiple or as IRR,
• Market provides a simple chart or table to demonstrate the attractiveness of currently investing in your target market segment
• Economics has the fund size and stage at the top and that provides a table with the fund economic terms, such as the Minimum Investment Amount, Management Fees and Carried Interest, with the name of the term on the left and the economic term on the right
• Disclaimer has acceptable legal language for your home country to avoid liability for any statements
• Thank You has the tagline of the fund, the target closing date, and the contact information for all of the General Partners,

Optional VC Slides

• Strategy – what deals that you target
• Operations – how you close and service deals
• Competition – notable funds doing similar things
• Partners – any strategic corporate or funding partners
• Advantages – key selling points to target investments

Bonus: Sample VC Disclaimer Language

Below are a couple sample disclaimers for reference purposes. Please consult with an attorney before using.

Standard Fund Disclaimer

“The information herein is strictly confidential and is intended for authorized recipients only. The content of this presentation is shown for information purposes only and is not intended as investment advice, or an offer or solicitation with respect to the purchase or sale of any security. The strategy presented herein represents the strategy of the General Partner of the Fund as of the aforementioned date and may vary at the discretion of the General Partner. There is no guarantee that any investment objective will be achieved. Past performance is not indicative of future results. Actual results may differ materially from those expressed or implied. Recipients should not assume that any companies identified in this presentation, are or will be, investments held by the Fund. Any projected returns presented herein are shown for illustrative purposes only. There can be no guarantee the Fund will achieve these results. Venture investing is risky and you could lose some or all of your investment.”

Forward Looking Statement Disclaimer

“The information contained herein constitutes forward-looking statements. We assume no obligation to update, and you should not unduly rely on such statements.”

About The Author

Adeo Ressi is CEO of Decile Group, powering the next generation of venture capital firms worldwide with an integrated offering of training, tools, support, and funding. Decile Group is the parent of the VC Lab venture capital accelerator, which helped to launch nearly 50% of all new manager firms in 2022. Adeo is also Executive Chairman at the Founder Institute, a pre-seed accelerator with chapters in over 250 cities worldwide and over 5,000 portfolio companies.

Adeo has launched 14 venture capital funds and founded 11 startups, having nearly $2 billion in exits before 30. Adeo previously served on the Board of the X Prize foundation to pursue his interests in space exploration. He studied architecture and spent time living on a commune to explore his interests in designing better ways to live. Adeo is passionate about inspiring people to achieve their potential.

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Best Practices for Creating a Top-Notch Investment Presentation

Raising venture capital is difficult. On top of having a business or product that a VC finds “fundable,” you need to have a system in place to raise capital. This includes everything from identifying the right investors to pitching investors to nurturing investors.

Related Resource: How To Write the Perfect Investor Update (Tips and Templates)

Inevitably, you will have to present or pitch to investors over the course of a fundraise (typically using a pitch deck ). To learn more about how to best pitch and present to your potential investors, check out our tips below:

What is the purpose of an investment presentation?

An investment presentation or pitch is a tool to help founders share their company story and vision with investors. An investor presentation is a visual representation of your company narrative and includes things like metrics, roadmaps, team members, etc.

Kristian Andersen of High Alpha breaks down how founders should think about crafting their pitch deck and story below:

Related Resource: Tips for Creating an Investor Pitch Deck

How long should an investment presentation be?

There is no exact answer when it comes to determining the length of your pitch deck. Different businesses and pitches will require different pitch decks, but we have found that as a rule of thumb founders should shoot for a pitch deck that is 12 slides or less.

We studied our own data from our pitch deck sharing tool and found that the average number of slides in a pitch deck (where 100% of slides were viewed) was 12.2 slides.

Related Resource: Pitch Deck 101: How Many Slides Should My Pitch Deck Have?

Many investors agree with somewhere between the 10 to 15 slide range as well. Alex Iskold of 2048 recommends a short pitch deck that should be 10 or fewer slides.

What your pitch deck should look like for your investment presentation

As we mentioned previously, every business is different. The needs for different slides and narratives will differ from business to business. However, there are a few slides that are typically used regardless of the business. Check out a few popular pitch deck slides below:

1) Discuss the company overview

First things first, clearly present your company and what you do. This should be easy to digest and understand for the investors you are pitching.

2) Present the problem

Use data, stories, or a compelling way to present the problem you are solving. Ideally, you’d like your audience to feel the problem or have a good grasp of others experiencing the problem.

3) Present your solution

Once investors understand the problem you are tackling, you need to lay out how your solution solves the problem. Make the case why you and your solution are the ones to solve the problem.

4) Highlight the target market

Next, lay out the target market and what your ideal customer looks like. This can help investors answer the “why now?” question.

5) Illustrate the market opportunity

At the end of the day, investors want to invest in companies that can turn into huge companies. Demonstrate the market and how it is (or has the opportunity) to become a large market.

6) Identify the competition

Investors will want to understand the space. Lay out your competitors and explain how you are different and better than them.

7) Showcase your product

Next, showcase the status of your product and future plans. Use data or customer stories to share how awesome your product is.

8) Share why your team is the one to solve the problem

Show your executive team members and share their relevant experience and skills so investors understand why your team is fit to execute the problem and the solution.

9) Explain your business model and marketing strategies

Investors want to know that your business has a clear plan and strategy to generate revenue. Clearly lay out your acquisition strategy and sales & marketing efforts to date so investors can understand how your business will attract and close new customers.

10) Present financial data and metrics

Of course, investors want to see the data and metrics behind your business. Lay out key financial and core metrics so investors know the status of your business.

Qualities investors want to see

An investor’s job is to generate returns for their investors (limited partners, LPs). What investors look for in a potential investment will vary from firm to firm but we laid out a few of the common attributes investors want to see in a founder and their business below:

• Large market
• Clear customer acquisition strategy
• Experienced team
• Strong leadership
• Traction and growth
• Coachability

Of course, those are just a few of the traits investors will look for in a founder or startup. Different investors will place a different level of importance on different attributes. It is important to understand what an investor looks for in an investment and tailor your pitch to them.

Related Resource: Startup Metrics You Need to Monitor

Best practices for a top-notch investor presentation

As we’ve mentioned, different investors will look for different attributes in a presentation. However, most things investors look for can be boiled down to a few key areas. Below we lay out a few best practices for putting together a top-notch investor presentation.

Practice your pitch

This should go without saying but make sure you practice your pitch. You should know the ins and outs of your presentation and business. Of course, practicing in front of a mirror or friend can only go so far.

Some founders and investors recommend “ranking” your investors before approaching investors. E.g. Tier 1 investors are the best fit, Tier 3 are less of a fit for your business. If you rank your investors you’ll be able to spend some of your earliest pitches on “Tier 3” (or lower fit) investors to dial in your pitch and prepare for your pitches with better fit investors later on in your fundraise.

Related Resource: How to Pitch a Perfect Series B Round (With Deck Template)

Keep your message simple and clear

Investors see hundreds or thousands of pitches over a given year. Being able to clearly articulate your message and pitch is a surefire way to remove any confusion. By keeping your message simple and clear, you’ll remove any back-and-forth wasted on small details and be able to spend time on what matters most — having a conversation about your business.

Find ways to connect with the investors

At the end of the day, a founder is selling their company to potential investors. Like a good sales process, a good investor pitch starts by building a relationship and trust. When pitching potential investors, find ways to connect with them in advance of the pitch. This could be everything from following and interacting with them on Twitter to going to in-person events where they are present.

Highlight early successes and wins

Get potential investors excited about your business by sharing early successes and wins. This will get the presentation off on the right foot and allow everyone to build excitement around your business. Of course, try to back up your early successes and wins with data when possible.

Know your metrics

Inevitably, investors will want to dig into the metrics and data behind your business. For most investors, this is used to evaluate your business and could be considered the best predictor of success for your business.

However, metrics can also be a barometer for how well you know your business. You don’t need to remember every data point behind your business but need to know how different metrics are calculated and what causes any major fluctuations.

Include engaging visuals and graphics

An investor presentation is a tool used to pitch your business. In order to best engage with your audience, you should aim to have engaging visuals and graphics throughout your presentation. Of course, the underlying data is what is most important but having engaging and easy-to-understand visuals and graphics is a great way to support and improve your pitch.

Leave time for questions

The best pitches and presentations tend to be more conversational. You’ll want to balance feeding your investors with the material they need and also be able to have a constructive conversation about your business. By coming prepared, having a clear and simple presentation, and engaging with your investors beforehand is a surefire way to have a conversation about your business.

Communicate before your presentation

Investors need months of data and interactions to make a decision about a potential investment. In order to best help investors build conviction and have more meaningful conversations, make sure you are engaging with potential investors on a regular basis. This can be in the form of your monthly investor updates or sharing your pitch deck in advance before a meeting.

Sharing your pitch deck in advance of a meeting is a hot topic. Some investors will say you should and some will say the opposite. At the end of the day, it is important for you to feel out the investor and do what you believe is best for you and your business.

Related Resource: 18 Pitch Deck Examples for Any Startup

In-person vs remote investment presentations

Before 2020, investment presentations were generally in-person. However, since the way we work has shifted so have investment presentations. Investors are largely open to receiving pitches and making investment decisions via a remote presentation. Learn more about the pros and cons of both in-person and remote presentations below:

In-person presentation

Before 2020, in-person presentations were the go-to for investment presentations. In-person presentations come with both pros and cons. On the positive side, in-person presentations are typically a better way to build relationships and will make sure an investor’s time is undivided.

On the other hand, in-person presentations can be expensive (both financially and time-wise) for an early-stage startup founder that might not have the resources to travel across the country. This will likely limit the number of potential investors that a founder can meet with over the course of a fundraise.

Remote presentation

Remote presentations and investor pitches have risen in popularity since COVID. Many investors are becoming comfortable with investing in companies remotely and is largely accepted by most investors. Like in-person presentations, remote presentations come with their own unique set of pros and cons.

On the positive side, remote presentations allow founders to meet with more investors as it is more viable financially (and time-wise) to meet with investors remotely. On the flip side, some individuals might find that developing a relationship remotely is more difficult and can take more meetings and a different style of communication to build trust.

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A Comprehensive Guide for Venture Capital Presentations

Venture capital presentations are often make-or-break propositions for startup companies. Creating the best investor deck and nailing your in-person presentation should be the main things you’re focusing on. Use an online data vault or any other tool if you believe it will improve your presentation.

If this is the first time you’re making a venture capital presentation, the process can be nerve-wracking. We can make things somewhat easier by offering a comprehensive guide for that aforementioned task.

Included in this article are the things you must know if you have a venture capital presentation coming soon. Keep them in mind as you prepare your pitch deck and presentation. 

Prepare the Appropriate Documents for Your Presentation

You must get some documents ready ahead of your presentation. There are three, in particular, that you will need.

First off, you must prepare the investor pitch deck. The investor pitch deck is going to be the main reference material for your potential investors. If they want to know something important about your startup company, they should be able to find it in the pitch deck.

The pitch deck is one of the most important documents you’ll ever put together. Make sure it gets the attention it deserves. The pitch deck should also be in PDF format. That will allow the investors to access it easily.

After your investor deck, you need to work on your presentation. Microsoft’s PowerPoint program is typically used to make this.

Think of the presentation as a more condensed version of your pitch deck. Try to highlight the most important points only.

Remember too that you will be talking while presenting the slides. Those slides have to pair well with the talking points you want to focus on.

Lastly, you will have to create an executive summary. The executive summary should be even shorter than the presentation. It should not be more than two pages.

The executive summary must be a document that an investor can read completely while they’re traveling. That may be all the time your target investor can spare so make it count. 

Include Essential Details in Your Documents 

When creating the documents that will be part of your venture capital presentation, there are certain details you cannot leave out.

Begin by highlighting the goals of your company. Discuss why you’re entering the industry and why you believe you can make a difference. Speak with conviction when doing so the investors buy what you’re selling.

After that, you need to highlight the idea behind your business. Identify the problem your products or services are meant to address. Shine a spotlight on the unique opportunity you’re aiming to capitalize on.

Don’t omit those details because they will let your investor know if your startup business is truly viable. Next, it’s time to talk about your products or services. Explain their key features. Also, mention the technology being used to develop them.

It’s also important to acknowledge the competition in your investor deck. Recognize your industry competitors and honestly assess how you believe your startup business will stack up to them in the short and long term.

Remember To Include The Human Side Of Your Business

You should also talk about the people in your company. Talk about their backgrounds and the roles they have.

Detail your marketing and financial plans for your business. Let investors know that your expertise goes beyond offering certain products and services.

We also urge you to include any legal documents or documents pertaining to intellectual properties. Having those documents on file will give investors more confidence in the opportunity you’re presenting.

Also, highlight the progress you’ve made so far and show how an investment can take your startup to the next level. 

Form a Narrative in Your Documents 

You cannot just put data on the documents and call it a day. Prioritize cohesiveness when creating your investor deck so you can grab the attention of investors more effectively.

One way to do that is to construct a narrative. Weaving that narrative keeps the investors engaged throughout the presentation. Their eyes are less likely to glaze over while reading if they are interested in the story you’re telling.

Capture the investor’s attention long enough with your narrative and they will gain a better understanding of your business. They can judge it fairly and decide if it’s worth their money. 

Ask Trusted Advisors to Review Your Documents 

After you finish creating your investor deck, presentation, and summary, you should get those documents reviewed.

Look for an attorney who can review your legal documents, an industry expert who can evaluate your offerings, an accountant who can check your business plan, and a marketing professional who can go through your ads. Check with them and see what they think of the documents you made. Seek their feedback and make revisions as needed.

You don’t get a lot of opportunities to present to angel investors. Sometimes, you just get one shot to wow them. Don’t waste that opportunity by presenting poorly. Create the best investor deck you can and maximize the opportunity in front of you. 

Rehearse Your Presentation 

Tensing up ahead of your presentation is normal. Still, you cannot let that ruin your presentation.

Prepare yourself for the presentation by rehearsing ahead of time. Rehearse in front of your advisors if possible. Ask them if you were able to hit on your points during the presentation.

Taking the time to rehearse prior to presenting can make a significant difference. After you get the beats of your presentation down, speaking in front of your potential investors will feel more natural. 

Don’t Get Sidetracked by Questions

The investors will likely ask you some questions during your presentation. Many of them should be questions you can answer correctly if you did your homework. Others may not be so easy to field.

Don’t be afraid of telling your investors that you cannot answer a question just yet. That’s better than trying to dance around the question since investors can usually sniff that out.

Circle back to your presentation after addressing the questions from the investors.

Parting Words 

Making your venture capital presentation can be daunting, but you do not need to fear if you’re adequately prepared. Follow the tips for presenting and creating the essential documents included in this article and your next meeting with a potential investor should go smoothly.

You may be interested in: What is a Presentation? Definition and examples

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Venture Capital Fund

An investment fund that invests in early- and growth-stage (risky) startups that offer high return potential

Almat currently works as a Financial Advisory Services (Business Valuation) Consultant 2 at Deloitte Kazakhstan, where he works with clients across multiple industries. Prior to joining Deloitte, Almat spent 9 months as an Audit Assistant 1 for KPMG Caucasus and Central Asia, where he focused on the asset management and banking services industries.

Almat has a Bachelor of Finance from KIMEP University.

• What Is A Venture Capital Fund?
• How Do Venture Capital Funds Help Startups?
• Venture Capital Vs Private Equity
• How Do Venture Capital Funds Make Money?
• Pros And Cons Of VCFs
• What Are The Different Stages Of Venture Investment?
• The Life Cycle Of A Venture Capital Fund
• Who Can Invest In A Venture Capital Fund?
• Minimum Amount Of Money Needed To Invest

Top Venture Funds

• Operating A Venture Capital Fund
• The Modern Definition Of Venture Capital Fund By The SEC
• How Do Venture Capital Funds Raise Capital?

Venture Capital Fund Management Fees

• Analysts' Daily Work

What is a Venture Capital Fund?

Nowadays, there are lots of successful publicly-listed companies. Firms with the highest market capitalization are MAMAA companies. MAMAA stands for Meta (Facebook), Apple, Microsoft, Amazon, and Alphabet (Google).

Besides being tech companies, all mentioned above have one common thing: venture funding. So all of them started with sourcing from venture funds.

A venture capital fund - is an investment fund that invests in early- and growth-stage (risky) startups that offer high return potential. The venture capital firm manages the fund, while the fund investors are typically HNWIs and institutional investors.

VC firms invest their own money into the fund and manage others' investments in the fund. In addition, the firm is responsible for finding investment opportunities and generating substantial returns for the investors.

First, we will discuss the role of VC funds in startup growth. Next, we must cover the differences between VC and private equity. Then, we explore how VC funds make money. 

Furthermore, we look at the advantages and disadvantages of VC for investors and founders. So, let's dive into the role of VC funds in startup growth.

Key Takeaways

• A venture capital fund is an investment fund that invests in early- and growth-stage (risky) startups that offer high return potential.
• VC focuses on early-stage, innovative startups with equity financing, while private equity targets mature companies, often using debt for control.
• VC funds generate profits by investing in startups and achieving returns through exits, primarily via IPOs.
• Founders benefit from capital and expertise but may lose ownership, while investors gain diversification and potential high returns but face risks and limited liquidity.
• Venture investment occurs across multiple stages, including angel investors, seed funding, series A, series B, series C, and subsequent rounds.

How do Venture Capital Funds Help Startups?

VC fund is crucial for the success of the startup. VC funds provide financial capital through infrastructural investments (manufacturing, marketing sales, fixed assets, etc.). The other necessary capital funds are the industry expertise and guidance for founders (hiring, customer acquisition, and other challenges).

The fund's financial capital and industry expertise help startups grow faster than organic growth (using internal funding of the startup). In other words, it's easier for a startup to scale using VC funding and expertise. 

The startup couldn't achieve tremendous results with its cash and expertise. Thus startups use VC to scale their businesses. They use VC funding on different funding rounds: seed, series A, series B, series C, series D, series E, and F. 

The VC fund is investing in startups to maximize return on investment . The fund makes money by selling the startup via IPO . The expected return is usually 5x, 10x, 10,000x, etc.

venture capital Vs private equity

Let's talk about the distinction between the VC fund from the private equity fund.

Venture funds tend to invest in risky, early-stage, growth firms. They typically use only equity to finance their transactions and acquire only minority ownership in the company. 

VC funding is primarily accessible to businesses operating in innovative industries like tech, biotech, fintech, etc. Venture funds use diversification as a tool to lower the risk. 

For example, they might invest in 100 companies. Only one of those companies can succeed, cover all the previous expenses, and bring huge returns.

Private Equity Funds invest in mature, established companies. They usually use debt and high leverage to acquire 51% or more controlling company shares. The typical fund concentrates on a few companies and thus bears the considerable risk. 

However, the maturity of the portfolio firms decreases the risk since mature companies are less susceptible to failure.

How do Venture Capital Funds Make Money?

The fund invests in a company, involves the company's operations, and finally exits from that deal by selling it to a public or strategic buyer. The primary investment philosophy of the fund is Barbel or power-law distribution.

The fund invests in many small startups that can potentially generate high returns. However, only 1 out of 10 startups will survive in five years, and only 1 out of those ten survived startups will grow in 10 years. 

The fund expects that at least one or two successful startup deals will cover all the expenses of failed startup investments and even bring enormous profits for the fund.

Pros and Cons of VCFs

The advantages and disadvantages vary depending on how you're looking at VC. Let's discuss the benefits and drawbacks of VC for both founders and investors.

The founders can use both financial capital and industry expertise. Moreover, they can boost their sales and marketing to expand into new markets using the knowledge of the fund. 

In addition, the incredible network of other experts, investors, and clients will make the odds in favor of the founders.

However, many founders lose their ownership after several funding rounds. Also, equity financing is the most expensive financing option for a business compared with debt or internal cash. The high expectations might put additional pressure on the company's growth. 

Not all startups are innovative and operate in the tech field. For many, VC might be an inappropriate funding option.

Investors consider VC an alternative investment uncorrelated with the public securities market . Thus, it's a great way to decrease the overall portfolio risks. Also, VC investing provides a decent return potential (100,000x in a good deal).

However, investors have to keep in mind that it's a risky investment and can lose all their invested money. Also, VC is illiquid. Investors can invest only through limited partnerships. 

It means that investors have no rights to the fund manager's operations and have to put the capital forward for five years with no withdrawal rights. That might be inappropriate for investors with short-term goals or with liquidity needs.

What are the Different Stages of Venture Investment?

The funds vary based on their industry, geography, funding stage, or a combination of those variables. For example, the fund may focus on early-stage biotech startups in the Asia-Pacific region. Let's now talk about the financing stages of startups.

1. Funding stages of venture investment 

VC is an umbrella term for all stages of funding. However, there are many times when a fund may invest in a company's lifecycle. 

Some have separate funds that specialize in each of the following stages since the needs of the businesses are different.

2. Angel investors

An angel investor typically provides financing for small enterprises before the official equity funding starts.

At this stage, friends or family of the entrepreneur invest their own money into the business. Subsequently, angel investors often take a more hands-on approach to their investments. 

3. Seed funding

Investors fund the development of an idea into an actual business that generates  revenue . Seed funding is often the first stage in which venture capitalists get involved. 

Usually, friends and family close to the founders give founders funds in exchange for an equity stake in the company or a share in the profits made from its products. At this stage, they are developing a track record of growing revenue.

4. Series A funding

At the Series A financing round, businesses can expand:

• Into additional markets
• Its user base and product offering with a focus on increasing sales

The Series, A round investors are commonly from more traditional VC funds, which generally contribute from $1 M to $10 M.

Management uses that money to execute the business plan and enhance its business model to generate long-term profit. The main goal of the business is to achieve a maturity level.

5. Series B funding

The Series B funding round is focused on passing the company to another degree of development.

Series B is similar to Series A regarding the processes and investors. However, a new wave of investment firms specializing in later-stage investing may enter the stage.

The investments range from $7 million to $10 million, with the primary purpose of ramping up talent acquisition to equip the company with the critical players necessary to execute its business plan. 

6. Series C: Expansion stage

Series C funding aims to give a business the capital to perfect its business model. At this point, the business concept is considered proven and less risky. 

Raised capital ranges from $1 million to $100 million. Businesses can use it for various goals, such as acquiring competitors for geographic expansion, intellectual property, or talent.

7. Series D, E, F: Bridge stage

A portfolio company might choose to offer additional funding rounds for different reasons. Frequently, it's in efforts to scale their business to new heights. Commonly, each subsequent round is represented by the following letter.

The Life Cycle of a Venture Capital Fund

The typical lifecycle of the fund is ten years. The reason for that is the long-term nature of the investments. For example, regular investment in startups requires 2-3 years, and the funding for those startups must be completed in 5 years.

In 7-10 years, successful startup deals must be closed, and all the funds returned to the investors.

Who Can Invest in a Venture Capital Fund?

The individual investor must be  an accredited investor  to invest in such funds. In other words, the investors must satisfy one of the following conditions:

• Individual income > $200,000/year OR Household income > $300,000 in each of the past two years
• Net worth > $1,000,000 (excluding primary residence)
• An insider in the company the person is investing (being a general partner, CEO , executive, managing partner, director , etc.)
• Accredited family office
• Licensed investment professionals holding Series 7 , 65, 82
• "Knowledgeable employee" of the fund

For the legal entities, depending on the entity, the requirements are the following:

• Owning investments > $5,000,000
• Assets  > $5,000,000
• All equity owners are accredited
• Investment advisers / SEC -registered broker-dealers
• Financial entities (bank, insurance company, registered investment company, etc.)

minimum amount of money needed to invest

The minimum investment amount depends on the fund requirements. So it's not standardized and is a measure depending on many other variables. So the investor has to check the fund's website or ask their investment adviser or broker about the investment requirements.

While there is no one-size-fits-all answer, many venture capital funds require a substantial initial investment, often ranging from $100,000 to $1 million or more. Some funds may have lower minimums for individual investors, such as accredited investors, but this varies widely.

However, it is crucial for potential investors to carefully review the fund's offering documents, such as the Private Placement Memorandum, to determine the exact minimum investment requirement and any eligibility criteria.

Consulting with a financial advisor is advisable to make informed investment decisions in the venture capital space.

Let us take a look at some of the top VCFs below:

1. Sequoia Capital

Sequoia Capital  is a renowned US firm founded in 1972 that partners with companies in early- and late-growth stages across all sectors. They have focused on the internet, mobile, healthcare, financial, and energy companies. 

Sequoia Capital turned its $60 million investment in WhatsApp into $3 billion after Facebook's $22 billion acquisition in 2014. It is the largest private acquisition of a VC-backed company ever at that time.

Accel , founded in 1983, is a US firm operating in California, London, China, and India. It primarily invests in early and growth-stage technology companies. A small portion of the fund's portfolio is invested in seed-stage companies.

Accel is an early investor in Facebook and co-leaded it with $12.7 million in Series A in 2005 with a 15% stake. After Facebook's IPO in 2012, Accel's shares were worth $9 billion. Overall, Accel earned a 700x ROI .

3. Kleiner Perkins

Kleiner Perkins  is an American firm. It's based in Silicon Valley and was founded in 1972. It invests in incubation, early-stage, and growth companies in the technology sector. 

Kleiner Perkins funded $12.5 million to Google in Series B round in 1999. The fund was an early investor in Google. After Google's IPO in 2004, Kleiner Perkins' stake was worth about $4.3 billion - a 300x return.

4. Andreessen Horowitz

Andreessen Horowitz  was founded in 2009 by Ben Horowitz, Marc Andreessen. Its headquarter is in Menlo Park, California. It mainly backs seed- and late-stage tech firms. It specializes in consumer, enterprise, bio/healthcare, crypto, and fintech space investments.

Andreessen Horowitz is the biggest investor in a cryptocurrency exchange platform - Coinbase. The VC firm led a $25 million Series B round, securing shares at $1 apiece. As a result, when Coinbase went public in April 2021, its stake was worth almost $10 billion - 400x ROI.

5. Benchmark

Benchmark  is a San Francisco-based investment firm. It was founded in 1995. The fund concentrates on early-stage investing in several markets, including financial services, enterprise services and software, and communications.

Benchmark provided $13.5 million in Snap Inc's Series A as the sole investor in the round in February 2013.

At a $25B valuation , Snap Inc. went public in March 2017. It is the second-highest valuation on the exit of any social media and messaging company since 1999. Benchmark's stake was at about $3.2 billion.

6. Founders Fund

Peter Thiel's Founders Fund , founded in 2005, is a San Francisco-based firm investing in science and technology companies building revolutionary technologies.

The firm invests in all stages across various industries, such as consumer internet, artificial intelligence, and aerospace. Founders Fund invested $200 million into a small biotech startup called Stemcentrx. Subsequently, Stemcentrx created innovative cancer healing therapy. 

AbbVie, the drug company, paid $1.9B in cash and $3B in stock to buy Stemcentrx in April 2016. Founders Fund, the company's largest investor, received $1.7 billion.

7. New Enterprise Associates

NEA  is a US-based firm founded in 1977 that focuses on seed to growth-stage companies in technology and healthcare.

NEA put $4.8 million in Groupon in Series A round in 2008. Since Google's IPO in 2007, Groupon's IPO in 2011 was the biggest IPO by a US web company. NEA's 14.7% share was worth about $2.5 billion.

8. Union Square Ventures

Union Square Ventures  was founded in 2003 in New York City. USV focuses on early-stage, growth capital, late-stage, and startup firms. The most famous deals were with Coinbase, Stripe, and Tumblr.

In 2007, USV invested $5 million in Twitter in Series A. USV beat the social media network competition from Insight Venture Partners, Benchmark, Kleiner Perkins, and CRV.

In 2013, Twitter's IPO valued the company at $14.2 billion. Union Square Ventures' stake was worth $863 million - a 170x return.

9. Greylock Partners

Greylock Partners  is one of the oldest funds in Silicon Valley. It was founded in 1965. They invest in seed-, early-and later-stage software, SaaS, heath-tech, artificial intelligence, and other technology sector companies.

Greylock Partners invested $80 million into Workday, a financial management and HR software vendor. The fund's stake was worth $700 million, a 9x ROI when the company went public in 2012. It was the highest-priced venture-backed IPO since Facebook's $637 million IPO.

10. First Round Capital

First Round Capital  is a San Francisco-based firm specializing in seed-stage technology businesses. Specifically, it targets technology companies in healthcare, consumer, hardware, enterprise, and fintech.

As an early seed investor, First Round Capital funded $510,000 in Uber while Uber was valued at $4 million. In May 2019, the company's value at IPO was $75.5 billion. First Round Capital's stake was worth $2.5 billion, a 4,900x return for the fund.

As of today, these are the top VC firms. To find out more about each company and the VC world, use the  WSO Company Database .

Operating a venture capital fund

How is a venture capital fund structured? The fund's structure is a limited partnership: the VC firm is a general partner, and investors are limited partners.

The limited partners are usually sovereign wealth funds, mutual funds , pension funds, endowment funds, insurance companies, etc. All the partners claim the ownership stake in the fund. Still, only the general partner, a VC firm, manages the partnership.

Venture Capital Fund Documentation

Requirements are varied depending on the jurisdiction of the fund. Still, typically there are three types of documents that the fund needs for its operations:

They have a limited partnership agreement . This document specifies the fund's general partner(s) and the limited partners and determines the operation's detail.

Private placement memorandum . Like a prospectus in a mutual fund, it's a disclosure document given to investors.

Subscription agreement . Specify the limited partners' financial commitment and how the fund uses those contributions.

Also, the fund needs deal-specific documents:

Term sheet . The general partner's (GP's) agreement terms to invest in the company.

Stock purchase agreement (SPA) . Determines how stocks are sold to investors.

Disclosure schedule for SPA . Exceptions and explanations for representations and warranties agreed on SPA.

Voting agreement . The voting requirements, in some instances, are for shareholders.

Investor rights agreement (IRA) . The rights and privileges of stockholders.

Right of first refusal / co-sale agreement . Grants the right to purchase stocks from the seller investor before anyone else.

Certificate of incorporation . A legal document specifying the company's formation (in this case, portfolio company). 

Tax-related documents:

Schedule K-1 . It is used to report the income and losses of the fund's limited partners.

Form 1065, Return of Partnership Income . Used to document the income and losses of the fund.

Venture Capital Fund Regulations

Venture capital funds are regulated by the Securities Exchange Commission (SEC). Since a VC fund is considered a  private equity  fund from a legal perspective, the VC firm must register with the SEC and report its activities.

There is one exception. If the fund is considered a qualified VC (assets under management < $150 million), those requirements don't apply.

Bank secrecy act (BSA) reporting requirements and other anti- money laundering regulations apply to institutional VC investors. The BSA is curated explicitly by the Financial Crimes Enforcement Network (FinCEN) of the US Treasury Department.

Also, the US Patriot Act specifies the know-your-customer ( KYC ) regulations for VC firms. In other words, KYC requires funds to identify, verify, and report the information to the government to prevent money laundering, financial fraud, and other financial crimes.

Insider trading regulations are another central point. Since the employees in VC firms operate in the portfolio company's business as an insider (being on a board of directors, shareholders, etc.), they possess a massive amount of insider data. That creates a regulatory risk.

The fund must prevent employees from any use of material nonpublic information (insider data) for illegal purposes, such as giving "tips" to friends or using the information to their advantage (open positions before dissemination of data).

The modern definition Venture Capital Fund by the SEC

In 2020, the reformed rules under Investment Adviser Act by  SEC . These reforms were aimed at modernizing the rules and addressing the current issues. According to the new regulations, the VC fund definition has been changed, and here are the details.

SEC's fund definition background: Initially, SEC required all hedge funds and private equity funds to be registered investment advisors (RIA) with no exception. However, Congress decided to permit VC funds to register as exempt reporting advisors (ERA), which eased the reporting requirements.

The reasons for that decision are two: 

1) it's uncommon for the VC funds to take control of portfolio companies, and those funds never use leverage; 

2) second, VC funds finance innovation by supporting startups with all the resources and expertise.

ERA: What does it mean? Exempt Reporting Advisor (ERA) has SEC's biased reporting and compliance requirements. As a result, it substantially decreases compliance costs and increases the investment freedom of VC funds. In addition, SEC doesn't require any routine audits.

The cost goes down considerably under this condition. For example, the legal costs decreases from $42,500 to $13,000, staff compliance efforts compensation go down from $225,000 to $28,500.

Criteria of the VC fund definition: The fund must satisfy these criteria to be registered as an ERA:

• Representation . It must show that it's targeting only VC strategy. All investor and marketing materials must speak for it.
• Leverage limitations . The fund must not use any leverage at any funding stage in any portfolio company.
• Redemptions . Investors must not do any annual rescue.
• Qualifying investments . 80% or more of the funds must be invested into qualified assets (private companies).

Non-qualifying investments are the following:

• Investments in other funds 
• Post- IPO  biotech financing
• Secondary investments

How do Venture Capital Funds Raise Capital?

First, the fund sets a particular target investment. Fundraising can take months to years, depending on the fund's reputation, strategy, and market situation. Once the target investment is raised, the fund is usually closed to new investors.

1. The investing process

The next important thing for the fund is to invest in startups for three to five years. The main goal here is to provide as many resources as possible. The resources include financial capital, industry knowledge , sales enhancement, product development, etc.

In the business financing round, it's common to have one "leading" fund investor the round. Often that investor (in our case fund) sets the key terms and negotiates the prices.

2. Generation and distribution of returns

The fund generates returns through exit opportunities. In general, there are three exit scenarios for portfolio companies:

• Direct share sale to another entity
• Merger with or Acquisition by the strategic buyer or private equity fund
• Initial Public Offering (IPO) on a public stock exchange

Funds might distribute returns either after they close all of their deals or after each agreement. 

There are two fees that LPs must pay for GP (the fund manager firm):

• Management fee . The annual payment is used to cover the operational expenses of the fund. The common industry standard is 2%
• Carried interest (carry).  The performance-based fee earned by VCs. Usually set to 20% of the profits

An  analyst  is the most junior role in a VC firm. Analysts are typically  MBA  students pursuing an internship or fresh university graduates. The primary responsibility is to:

• Conduct market research 
• Study the company
• Research the conquerors 

Analysts  attend conferences and try to scout deals that might lie within the investment strategy or thesis of the venture fund based on which the firm is investing. As a result, an analyst is expected to make $80K - $150K in yearly compensation.

Associates  are in more dominant positions than analysts. There are two types of associates: juniors and seniors. The majority tend to come with a financial background with powerful skills in building relationships. 

They don't make investment decisions in a firm but work closely with those who do. An associate is expected to get a $130K - $250K yearly salary. 

The next position is principal.  Principals  can make investment decisions, but they don't have the executive authority of the firm's overall strategy. A principal makes around $500K - $700K in yearly salary and a bonus of $1M - 2M in carrying.

Partner  is the most senior role within a firm. There are two types of partners: general or managing, depending on whether the individual has authority in investment or operational arrangements. 

Besides making investments, partners are also responsible for fundraising for the VC firm. The partner can make more than $1M in salary with around $3M - 9M in bonuses.

Similar to PE, VC funds' compensation also includes a carry bonus. Depending on the firm's performance, the payout can be pretty significant.

Learn more about careers and compensation in VC by visiting our:

1.  Guide to Private Equity Careers & Venture Capital Careers  

2.  Venture Capital Salary & Compensation, Average Bonus in Venture Capital . 

Analysts' Daily work

Analysts mainly do research, modeling, and other miscellaneous things. Your daily tasks will change as long as you climb the career ranks. Here is some insight from @Associate1 about working at a VC firm. 

"It depends on week-to-week. On average, sourcing could be 25-30% of the job. Many follow-up works are involved when sourcing (i.e., light  DD ).  DD  gets more intense if you decide to move forward (research, memo writing, customer calls, talking to other investors, etc.) 

I also don't do much cold calling. My network, the network of friendly investors, accelerators, things that the partners ask me to look at, etc., are my sourcing channels.

That eliminates the headache/time hassle associated with banging your head against the wall doing only cold sourcing."

What do the working hours look like at the firm? Do those hours vary by the firm?  @care1g  answers to all of those questions. 

"Depends on the stage of the fund and the firm's "reputation." Top late-stage / growth equity fund associates often work very long. They work long hours because their deal flow is top-notch, and they see every opportunity. 

VC is also a role where creativity starts from the bottom. First, associates have to build thematic market maps. Then, they are constantly sourcing/finding new deals in their spare time.

Generally, though, the hours are less than hours in classic PE. Term-sheet and other processes in VC are faster than in private equity. Occasionally, the decision to proceed with the deal is made within weeks. In classic PE, it takes months.

People who previously worked in the private equity space believe that the work hours are between 40-60 per week, and weekends are usually light in this industry. However, the workload goes up significantly during live deals.

If you want but don't know how to break into VC, check out our  VC Course .  Here  is a sample video to kickstart your journey into the VC space.

Everything You Need To Break into Venture Capital

Sign Up to The Insider's Guide by Elite Venture Capitalists with Proven Track Records.

Free Resources

To continue learning and advancing your career, check out these additional helpful  WSO  resources:

• Follow-On Offering
• Initial Coin Offering (ICO)
• Insider Information
• Investment Policy Statement (IPS)
• Securities and Exchange Commission (SEC)

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Investing guide 101

Navigating the world of vc funds.

Learn the Fundamentals of Venture Capital Investments

1.Introduction to VC Funds

1.1. understanding venture capital: the meaning behind vc.

In its most general sense, Venture Capital (VC) is a form of investment in startups that are in the early stages of development. The venture capitalists provide financing in exchange for the startup’s equity. 

A startup is a newly-established company that needs financial resources to grow its operations. Besides being fairly young, such companies are perceived by venture capitalists as extremely promising in terms of the return on investment. In most cases, VC-supported businesses are yet to enter the phase of generating profit or even revenue. 

Equity, on the other hand, can be defined as a percentage of the ownership in a startup—and that is what motivates venture capitalists to invest, especially if the company is projected to become a huge success. 

In addition to financial support, venture capitalists sometimes provide technical or managerial resources to companies who came up with an innovative idea, but lack professional expertise. 

Venture capital’s popularity has increased in the second half of the twentieth century, after founders have realized they need an alternative to bank loans. From the perspective of the bank, early-stage companies always carry a significant portion of risk. There’s a huge possibility that the company will ultimately fail to turn its business plan to reality and become incapable of repaying the loan. 

From the startup founder’s perspective, it’s better to utilize earnings for further growth than having to use them for paying back loans with high interest rates. That’s where venture capital comes in. 

The sources of venture capital come from highly-experienced investors, investment bankers, and other financial institutions. Its main characteristics are high risk, huge return potential, and long-term engagement.

1.2. What is a Venture Capital Fund?

A venture capital fund represents a pooled investment, a sum of financial resources to be committed to early stage companies that are perceived as high-growth opportunities. It is a form of investment vehicle that seeks such companies and is formalized as a partnership.

VC funds are actively involved in startups’ development. In addition to providing guidance, they often take membership in the company’s board of directors and have a role in managing startup operations.

Since venture capital funds represent pooled investments, they raise capital from external investors. VC funds can have one or more fund managers, who send prospectus documents to potential outside investors. The prospectus is a formal document, defined by the Securities and Exchange Commission (SEC) in the United States, outlining the details about an investment and helping participants make informed decisions. 

One of the fundamental fund manager’s responsibilities is to review numerous business plans in order to identify potential high-growth startups. Based on this, the above-mentioned prospectus is created and handed over to prospective investors, who make or decline the commitment after analyzing it. 

The next stage is finalizing the individual amounts and making investments into a number of startups that together make up the VC fund’s portfolio. Thus, in contrast to investment syndicates that focus on a single company, venture capital funds invest in multiple startups to mitigate the risk. This follows the “don’t put all your eggs in one Basket” logic; if one startup fails, the other one may be very successful. 

How Venture Capital Fund Returns Work

In most cases, venture capital fund investors generate returns after the invested company exits (e.g. through an Initial Public Offering), merges or gets acquired by another business. 

This is when a “2 and 20” fee structure applies, which is an industry standard in venture capital. The VC fund charges 2% fee of assets under management (AUM), as well as 20% of generated profits, provided the profit has been made after the company had exited. The assets under management represent the overall market value of investments that the fund manages on behalf of investors. 

The expected return can vary, since VC funds finance a wide range of businesses from different industries. However, the funds usually target around 30% return rate per year over the lifetime of the investment.

The lifespan of a typical VC fund is around 10 years. Since venture capital is notorious for being risky, there’s another general rule: one third of the invested startups ultimately fail, another third returns only the invested capital, and the last third of startups becomes successful. 

1.3. What Is a Venture Capital Firm?

The broadest definition of a venture capital firm would be an organization that raises financial resources from different sources to invest that accumulated capital into startup companies. 

Venture capital firms obtain investing money from institutional investors such as pension funds, investment banks, academic institution endowments, investment funds owned by the government, insurance providers, hedge funds, and individual investors with a net worth above $1 million. 

As a legal entity, a venture capital firm can include several different venture capital funds. Institutional investors are intermediaries in VC firms. They do not invest directly in startups, but operate as Limited Partners.

Investment Focus Differentiation

VC firms operate according to an established thesis. This means that each firm specializes in investing in a particular type of startups: based on a specific sector (e.g. automotive industry, dot com), stage, or geographic location. For example, the hypothetical VC firm may specialize in young companies that expand access to financial tools and knowledge about managing personal finances. There are generalist VC firms as well, investing in startups from all sectors.

1.4. Key Parties in Venture Capital

In order to have a better understanding on how venture capital works, here’s a brief overview of the key players in venture capital: 

Venture Capitalists

Venture capitalists generate profit by creating a market for investors, startup founders, or investment banks. They are responsible for identifying and executing promising deals, as well as running the VC firm. 

Startup Founders or Entrepreneurs

These are not ordinary business people. As crucial players in the VC industry, startup founders are entrepreneurs with a strong vision that can both generate massive profits and create big changes or disruptions in a given industry. 

Besides helping startup founders with legal matters like business incorporation, patenting, or representing them in negotiations with venture capitalists, lawyers are hired by VCs themselves to manage legalities related to raising capital, setting up a venture capital fund, and other issues. 

Investors 

In the context of venture capital, investors are individuals or institutions willing to take risk with a goal to generate high returns. They can be general partners at the top of the venture capital fund’s chain of command, or limited partners that actually provide financial resources for the fund, ie. money to be invested. Learn more about general and limited partners in the following sections. 

Investment Banks

The role of investment banks is to help entrepreneurs find investors, successfully implement Initial Public Offering, merge or get acquired by other companies. Also, investment banks can be direct investors.

1.5. VC Fund Structure In a Nutshell

As already mentioned, the VC fund is a sum of capital that will be invested by the management company, or a venture capital firm. Here’s how VC funds are structured: 

Management Company (VC Firm)

The management company is an entity formed by the general partners. It can actually manage multiple venture capital funds, and is responsible for their operations. In exchange for providing investment opportunities and dealing with fund’s expenses, management companies collect fees from limited partners, and often engage in invested companies’ branding, operations, and growth strategies. 

General Partners (GPs)

General partners can either be individual high-net-worth investors that partner with a VC firm, or VC firms (management companies) themselves. Usually, they deploy their own financial resources into a fund. Their primary responsibility is analyzing potential deals and making final decisions on where the collected money should be invested.

Besides management fees, general partners receive interest for sourcing deals and managing the fund. It is usually around 20% of the profits generated by the venture capital investment. 

In short, the general partner’s role can be broken down into two things: 1) directing investments to innovative and promising companies and 2) raising capital for future ventures.

Limited Partners (LPs)

This is where the capital comes from. Just as VCs finance startups, limited partners finance VC funds. The collected amounts are often measured in billions; however, LPs invest only a small percentage of the money they manage into venture capital. They diversify investments through different asset classes, each carrying a different level of risk and potential return. 

Relationships between limited partners and venture capital funds are formalized through limited partnership agreements (LPA). Those are contracts outlining how the capital will be invested and profits distributed among each party in a VC fund. LPAs often include clauses that protect limited partners, prohibiting VC firms from investing in problematic industries, such as gambling for example.

Limited partners tend to be the following:

• Government-owned funds that invest national surplus capital
• Pension funds (private or corporate retirement funds)
• Educational endowment funds (investing donated money with a goal to generate returns that are at least above the inflation rate)
• Family offices
• Insurance companies
• Funds of funds (investing in venture capital funds using financial resources from other LPs)
• Wealthy individuals (investing their own money)

When it comes to venture capital fund hierarchy, it can be divided into top-, middle-, lower-level and support-type roles. 

Managing directors and general partners are the examples of the first category, since they are the ones who have the final word about investment decisions. Limited partners can also influence decision-making, depending on the arrangement. 

Examples of mid-level roles are principals and directors; they are not involved in the actual deployment of the investment, but can influence the final outcome of a deal. The next category in the hierarchy are analysts and associates, who can have a wide range of functions. Support-type roles can include marketing, business development, or human resources specialists.

2. Venture Capital Investment Process

2.1. key factors in investment evaluation.

Regardless of the venture capital firm’s focus on a specific industry or startup development phase, there are key company characteristics that influence VC investment choices. 

Team & Management

This is by far the most important factor that influences venture capitalists’ decisions. According to a research by Harvard Business Review, the majority of VCs surveyed agreed that the teams have contributed the most to the failure or success of companies in their portfolios. 95% of the survey respondents argued that startup founders had the biggest influence in deciding whether to establish a deal. 

Not only should management have relevant experience in the industry, but the entire team should consist of individuals who are capable of implementing what is envisioned in the business plan. 

On top of that, venture capitalists look for founders with a history of leading companies that have generated significant returns for investors. Flexibility is another factor; if the business idea is excellent but the team lacks talent, the management should express the willingness to outsource experts. 

Business Model & Market-Related Factors

These factors include the startup team’s ability to accurately formulate a strategy at each stage of its development, how the profits will be generated, the size of the market for a given product or service, and competitive advantage – the way the product or service solves the problem for users. 

The business plan should provide detailed market evaluation, and include both third-party analysis and feedback from potential users themselves. Ideally, potential customers should demonstrate a need for the product and willingness to purchase it.

The best scenario is having a solution that addresses pain points of consumers, a large market and a small number of competitors. The bigger the market, the more options there are for the VCs to exit their investment.

Return on investment

Venture capitalists use various metrics to assess the profitability of a particular investment. These can be Internal Rate of Return (IRR), Cash-on-Cash return and other calculation methods. In any case, investors will expect to profit from the deal.

That is why it’s crucial for VCs to receive accurate projections of a startup’s long-term goals, specifically regarding how funds will be allocated at each stage of business development. Startups that have successfully secured funding have typically provided a detailed financial forecast, along with their runway. The aim of a financial forecast is to estimate the amount of capital required to operate a thriving business.

The startup runway is composed of two critical factors: gross and net burn rate. The gross burn rate reflects the amount the company spends each month. It’s calculated by subtracting the available funds from the total funds at the beginning of the year, then dividing that result by twelve months. Conversely, the net burn rate represents the difference between the company’s earnings and expenditures. It’s determined by deducting the monthly earnings from the gross burn rate.

These projections enable VCs to evaluate whether the investment will generate a return on investment or not.

2.2. Stages of Venture Capital Funding

Depending on the development stage of a given business, there are various stages of venture capital funding, each with its unique objectives and expectations.

Pre-Seed Stage

During this stage, the capital is utilized to assist the startup in developing an idea for a forthcoming product or service. This is an informal financing stage, often involving financial resources provided by founders themselves. In many cases, startups enter business incubator programs to explore potential sources of funding. These programs offer a variety of services, such as mentoring or connecting with venture capitalists.

The funds raised during the seed stage are typically employed to facilitate the transition from the initial concept to an early product or prototype. A portion of the funds is typically allocated to Research & Development (R&D), which entails gathering information about the future market and how the product will meet the market’s needs.

Venture capitalists usually secure favorable terms from seed-stage startups, which is why they take on more risk with the expectation of achieving significantly higher returns on investment.

Early Stage Capital

At this stage, funding is utilized to support the company’s further product development efforts once a certain level of traction has been achieved. Additionally, the funds raised are allocated towards marketing activities and sales promotion, as well as strategic planning for expansion into new markets.

Series A and Series B funding are forms of early-stage financing.

Expansion Stage

During the expansion stage, companies aim to secure funding for the improvement of existing products as well as the development of new ones. This funding is also used to support the actual expansion into new markets, enhance relationships with consumers through major advertising campaigns, acquire other companies, and prepare for the future Initial Public Offering (IPO). Typically, expansion stage capital is raised through Series C funding.

Later-Stage or Exit

This phase involves securing final financing before the company embarks on an Initial Public Offering (IPO). The sources of funding in this stage are typically hedge funds or private equity firms.

2.3. Types of Venture Capital Funding

As elaborated in previous sections, venture capital investors receive a portion of company’s equity in return for providing the investment capital. They do it through the issuance of security instruments. There are different types of securities, but the most common ones are convertible debt, SAFE notes, preferred stock or equity, and highly structured preferred equity. 

However, from the perspective of startup founders, these instruments can be divided into two main categories: equity, and debt. The first one refers to giving up a portion of ownership in a company through stock issuance, and the latter, as the words suggests, refers to borrowing money – either by issuing bonds or taking out a loan. 

Have in mind that startups and investors may have different objectives. The founder’s main focus is the process of getting the company off the ground, while the investor’s biggest concern is return. That’s why both parties need to decide on a security instrument to be used and ensure favorable terms for everyone. 

Read on to learn more about each type of security instrument most commonly used by VCs. 

Convertible Debt

One of the most traditional methods of VC investing comes in the form of a convertible debt. This security instrument is designed to convert from debt to equity at some predetermined point – either in the next financing round or at the exit or liquidation stage, when an invested company enters an IPO.

The final amount that will ultimately convert to startup equity will consist of the principal amount of the convertible debt, plus interest that’s been accrued by the date of conversion. Thus, just as with traditional loans, convertible debt comes with an interest rate (usually around 2% or 3%), as well as a term of around two years. 

The price at which convertible debt will convert into company’s equity is determined by one of the factors below: 

Valuation cap. This is the maximum valuation at which the debt will convert. For example, a startup company may raise convertible debt at a $2 million valuation cap, and everything above that $2 million goes into valuation in the next funding round. 

Discount percentage. This is the discounted rate at which the convertible debt will convert; for example 90% of the original share price. 

There are benefits of convertible debt implementation for both investors and startups. VCs and founders do not need to agree on a startup valuation when defining the convertible debt terms, thus avoiding complex due diligence processes and fees. On the other hand, in case the startup exits at a lower amount than initially projected, the capital investor will be paid out before other parties engaged in investing. 

This type of security instrument was popularized by Y-combinator, a well-known startup accelerator company that facilitated launching of over 4,000 companies, including names such as Reddit, Coinbase, Airbnb, Quora, and Dropbox. SAFE is an abbreviation for Simple Agreement for Future Equity .

In a similar manner as convertible debt, SAFE notes convert to equity at a future financing round (e.g. Series A funding), and also include valuation cap or discount rate. However, there is no debt involved, and consequently there are no interest rates. 

The advantage of SAFE notes is that they are significantly less complex, require fewer terms to be negotiated, and are more favorable to founders than convertible debt. 

Preferred Equity

Preferred equity is most commonly used in larger venture capital investments, during the later-stages of startup development. Its main characteristic is a seniority over common shares when sale or liquidation of the company occurs. To put it simply, if a startup had raised $15 million and got sold for the same amount, all the money goes to investors (and preferred equity holders get paid before common shareholders). 

Preferred equity can also include anti-dilution clauses that provide additional benefits to investors. This allows them to sustain the equity ownership percentage even if new shares were issued.

Highly Structured Preferred Equity

This security instrument is typically used when investing in highly-developed, unicorn-type startups. It is a combination of convertible debt and preferred equity; for example, a company wants to raise $1 billion without prior business valuation write-down. Founder’s goal is not to go below that amount, and they create an instrument that comes with high interest rates and/or dividends. 

The benefit for investors is that they have priority when liquidation or exit occurs, plus higher returns in the form of dividends or interest.

2.4. Characteristics and Features of VC Investing

In this section, we’ll describe the most important aspects that both VCs and startup founders need to be aware of before engaging in the processes of investing and fundraising. 

Long Term Horizon

Venture capital investing involves a significant delay between the initial investment and ultimate returns. This implies high risk, which is why VC investments tend to feature high returns in order to compensate. 

Illiquidity

In contrast to publicly traded instruments such as stocks or bonds, VC investments do not imply short-term returns or payouts. Thus, venture capital mostly relies on the projected success of the initial public offering. 

Private Vs. Market Valuation Discrepancy

There is no precise method of determining a company’s actual value on the market, since VC investments are carried out by private funds. As a result, Initial Public Offering can produce significant speculation on both buyer and seller side. 

Also, startups usually develop an innovative product that will potentially disrupt the market. Because no one else has created a similar product or service before, no one can tell for sure what its actual market value is. 

Conflicts of Interest

We have already mentioned that founders and VCs have different concerns; the first one is concerned about the processes, and the latter’s main interest is ROI. 

Discrepancies in viewpoints may arise between limited partners and fund managers. Fund managers are sometimes compensated based on the amount of capital pooled by the venture capital fund, rather than the return on investment generated. As a result, fund managers may be more inclined to take on higher levels of risk than other VC investors are comfortable with.

3. Becoming a Venture Capitalist

3.1. starting a vc fund.

In the following section, we’ll go through the key components every aspiring fund manager should define in order to establish a successful venture capital fund. Each of these points should work in synergy, while the fund itself should have a clear point of differentiation when it comes to approach to investing. 

Established Track Record

Having an adequate background is one of the most important things for building quality relationships with limited partners. If you’ve already run an accelerator program, or collaborated with entrepreneurs, that is certainly a plus. You’ll also need to demonstrate a comprehensive understanding of the venture capital industry. 

Have you been a startup founder yourself? Do you already have previous investing experience? If answers to these questions are positive, this is to your advantage. Do your best to communicate your history of success, credibility, and competitiveness with limited partners, as it’s crucial for building mutual trust. 

VC Fund’s Mission and Investment Thesis

Ask yourself the following: why does the industry need your VC fund? What is your main motivation for establishing it? 

Each successful VC fund has a point of differentiation. Thus, try to clearly define the purpose and principles of your fund; it may be backing small businesses in a specific geographic area, supporting technology-driven startups that disrupt traditional finance, or providing capital to companies that implement AI in healthcare.

Being authentic and having a clearly defined mission and vision will help you attract both startup founders and investing partners. Based on all of this, as well as your previous track record, you’ll be able to develop an investment thesis. Ideally, the investment thesis of your VC fund will evolve at the same pace as the focus industry. 

Deal Sourcing 

For every fund manager, it is imperative to have a sufficient flow of relevant early-stage companies to invest in. There’s a variety of ways based on which fund managers generate the deal flow : 

• Having an established network of connections with research centers or educational institutions
• Running a startup accelerator or incubator program 
• Using tools like Motherbrain to identify promising startups
• Building the VC fund’s brand through marketing activities to motivate companies to reach out themselves

VC Fund’s Operating Model and Strategy

The first step toward building your fund’s strategy is analyzing other VC funds in the same industry, and adapt the model according to the most common practices. This will help you: 

• Build an approach to fund size and capital allocation
• Define the number of startups to invest in, and the portion of ownership in each
• Develop a fee/carry structure, co-investing roles and rights

You should also consider getting legal guidance on necessary tools and infrastructure to make sure your fund is compliant with regulatory requirements. 

Satisfying Limited Partners’ Interests and Ensuring Their Commitment 

It is essential to ensure that your limited partners can commit enough time to your venture fund, as it will be a long-term relationship. In addition to time commitment, offering financial incentives such as a hurdle rate, which is a minimum rate of return, can motivate VC investors to back the project. Typically, limited partners expect at least 1% of the VC fund size.

3.2 Starting a VC Firm

When considering starting a venture capital (VC) firm, the first thing that comes to mind is likely the cost of formation. However, estimating the formation costs of a VC firm is challenging since it depends on several factors, including its size, scope of activities, and location. These costs can range from $5,000 to as much as $1 million.

Although choosing a name for your VC firm may seem like a minor task, it should reflect the firm’s focus and mission. Make sure to come up with something memorable and check the availability of a web domain for it.

Business Plan

Apart from branding, there are several key steps involved in establishing a VC firm. The first of these is creating a business plan. Putting all essential details on paper will help everyone involved fully understand the VC firm’s strategy and roadmap. Additionally, the business plan will be used as a presentation tool when forming partnerships with other VC investors or institutions.

The business plan typically begins with a summary of the key details, followed by a VC firm profile overview that clarifies whether the company focuses on specific industries, startup development stages, or particular geographic locations.

It should also include customer and industry analyses. The former should address targeted startups and their specific characteristics, from operational structure to CEO personas. The latter should focus on the size of the industry in which startup companies operate, what factors affect that industry, and so on.

Next, a competitive analysis should be conducted. Are there similar VC firms operating in your scope of interest? What are the primary reasons and industry gaps that your VC firm will fill? Having good answers to these questions puts you on a solid path.

Finally, it is crucial to determine and thoroughly describe the processes behind daily operations. Define the needs of your staff, create a projected timeline of the VC firm’s progress, and outline what you plan to achieve in the short and long term. This will help you determine the financial requirements, including costs and expenses, as well as the way your VC firm will generate profits.

Legal Structure

If your VC firm is going to be located in the United States, you will need to choose an appropriate legal structure for the business entity and register with the Secretary of State. The most common legal structures are Limited Liability Company (LLC), Sole proprietorship, Partnership, C Corporation, and S Corporation. Before making a decision, consider the advantages and disadvantages of each business entity structure .

In contrast to venture funds that are usually formed as limited partnerships, VC firms are usually structured as LLCs.

Taxation and Banking

If your VC firm will have employees, you’ll need to register the company with the Internal Revenue Service (IRS) to obtain an Employer Identification Number (EIN). The EIN is required by banks to open your business banking account and serves for the IRS to track your tax payments.

Next, select your bank and establish a business account. The process of opening a bank account is straightforward, but requires you to submit documents such as your VC Firm’s Articles of Incorporation, which you obtain during the legal entity formation process.

Business Credit Card, Licenses, and Insurance

To separate your VC firm’s expenses from your personal expenses, you will need to obtain a business credit card, either from a bank or a credit card company.

Your VC firm will require various licenses to operate, such as the securities license. This license will enable your business entity to engage in actual investment activities. To obtain the license, prospective fund managers must pass the Financial Industry Regulatory Authority’s (FINRA) qualification exam , called Securities Industry Essentials (SIE).

Next, find an insurance agent who can recommend an insurance policy you will need to operate a venture capital firm. Different types of insurance are required depending on the state where your business operates, including general liability, workers’ compensation, commercial property, business interruption, or professional liability insurance.

Software & Equipment

Chances are you will need some software solutions to help you track and manage your investments. There are various tools specifically designed for VC and deal flow management.

Depending on your circumstances, you may need to purchase or lease office equipment necessary for running a VC company.

3.3. A Closer Look at VC Firm’s Associates and Partners

The venture capital industry is growing rapidly, leading to increasingly complex structures and hierarchies within VC firms. General partners are responsible for overseeing the firm’s operations, while hiring full- or part-time associates to take on various roles and responsibilities. 

With so many types of VC associates, it’s important to understand their different scopes of specialization, roles, and responsibilities. Here, we’ll explore five of the most common types of VC associates and what they bring to the table.

Operating Associates

Operating Associates are a category of VC associates that work closely with the startups within the portfolio. These associates often specialize in fields such as marketing and advertising, product development and design, or finance. 

Their main role is to help startups enter the market or make preparations for the next milestone in their roadmap. Operating associates are typically junior- to mid-level members of venture capital firms and are sometimes formally titled as analysts.

Board Associates

Board Associates, on the other hand, are mainly focused on improving the governance, management, and strategy of the startup company. They actually become members of the board in portfolio companies and are sometimes referred to as Non-Executive Directors. 

Ideally, board associates are experts in a given industry and have an established network of relevant connections. One of their main functions is to strengthen the relationship between the VC fund and the invested company. Additionally, they regularly perform due diligence and analyze portfolio companies’ business plans. These are typically senior members of the VC firm.

Fundraising Associates

A VC firm may establish a relationship with professionals focused on generating funds. This is especially true when VCs want to access a broader network of investors. In many cases, they start out as a contractor in a VC firm, and later become general partners after the fund has been closed successfully. 

Deal-Sourcing Associates 

Deal-Sourcing Associates play a critical role in introducing investment opportunities to the VC firm. They usually have a well-established network of connections in a particular industry and are often startup founders themselves, but they can also be angel investors . 

Instead of performing due diligence and analyzing deals, they focus on providing a regular deal flow. In return, they receive cash compensation in the form of a carry. Deal-sourcing associates can be senior or principal VC firm members, along with the general partner.

Sometimes, they formally serve as an Entrepreneur in Residence (EIR) – a highly experienced former CEO of a successful startup that contributes to the growth acceleration of the VC firm.

Biz-Dev Associates

Business development associates are responsible for increasing awareness about the VC firm in a targeted industry or community. A VC firm may specialize in a specific region, technology, or business vertical. Biz-Dev associates’ role is to present the VC firm at important events and introduce it to key individuals in the industry.

It’s important to note that many VC firm associates are engaged only part-time and do not rely on venture capital as their primary source of income. The different types of VC associates have varying responsibilities, but each plays a critical role in the success of the VC firm and its portfolio companies.

Having an MBA (Master of Business Administration) degree is a common trait among most venture capitalists. In addition to having relevant experience in private equity or investment banking, aspiring VCs are expected to have a solid education background. In the United States, Stanford and Harvard University are known for providing quality MBA programs.

3.4. How to Create an LP pitch deck

A Limited Partner (LP) Pitch Deck is a crucial tool used by venture capital firms to raise money from limited partners or institutional investors. This slide presentation outlines essential information about the VC firm, including its strengths, investment thesis, and plans for fundraising and future returns.

To create an effective LP pitch deck, it must be concise and clear. Today, potential limited partners only have a few minutes to review the slides, so it’s crucial to make every point count. In addition, the deck must include adequate legal disclaimers and align with LPs’ standards and expectations.

Let’s go through key points each LP deck has to cover: 

Introduction

The first slide should clearly define the VC firm’s mission and vision in a few sentences or bullet points. This should include the firm’s investment thesis, team’s background, and strategy. It’s also essential to present a unique value proposition for the firm that differentiates it from similar partnerships. 

This could be a market gap identified by the VC firm’s team or an untapped local area. It’s important to educate investors about market opportunities, but the information should be 

presented in a simple and straightforward manner.

It is preferable that the introductory slides showcase all members of the team and highlight their qualifications and credibility. Doing so will help to establish trust with potential investors.

Portfolio, Deal Sourcing and Investment Process

Use slides to showcase startup companies in the VC firm’s portfolio, the current fund size, the number of investments, the target startup ownerships, and the number of exits. It’s crucial to explain where the deal flow comes from and how it will continue in the future. 

This section should also describe the decision-making process behind selecting startups to invest in, preferably using graphic representations and diagrams. This will demonstrate to potential limited partners that your company has a sophisticated process of selection.

Track Record and Case Studies

Each quality pitch deck should include data that illustrates the performance of investments so far. It should highlight previous successes and recapitulate the years of experience in investing, results of coaching and advising you provided to invested startups, and preferably – financial return metrics. A metric commonly used for presenting investment returns is Multiple on Invested Capital (MOIC), sometimes called Equity Multiple – a total value of investment performance or shares in the fund relative to initial investment amount. 

Also, fund managers should present the ways in which they’ve contributed to startup growth and made a positive impact.

Fee Structure and Projected ROI

This section of the pitch deck is dedicated to informing potential limited partners of their commitments to the fund, and expected returns. 

It should provide details on the carry fee that is paid to general partners (a common percentage is 20%), as well as management fees for administrative services (usually around 2%). 

To show that investments are to be worthwhile, the projected Return of Investment (ROI) should be included too. Limited partners usually expect a three to five times greater return on the initial invested capital.

4. Pros & Cons of Venture Capital

4.1. benefits of entering the vc industry.

Acquiring insights on what it takes to build a successful business. People that work in the VC industry are able to witness the complete cycle of startup development; from initial idea, to fundraising, generating first revenues, all the way to becoming profitable. By performing due diligence, venture capitalists get to analyze business models, founders and customers, products and markets, supply chains, and so on. This allows them to understand the fundamentals of successful businesses.

Venture capital is hard to disrupt. Compared to other industries, venture capital is fundamentally tied to human cooperation and relationships. 

High revenues and excellent work-life balance. In contrast to other professions, venture capitalists earn way more. Also, since the process of investing is a long-term pursuit, there will be few occasions where VC professionals need to complete the tasks urgently. 

Developing innovation skills. Venture capitalists are known to support startups that are developing groundbreaking products, services, or technologies, which allows them to observe market trends and customer behavior changes before they become widely adopted. By focusing on building solutions that don’t exist yet, startups have the potential to generate higher profits than those that simply improve upon existing products. Furthermore, being involved with innovative companies fosters a forward-thinking mindset that can anticipate what will be popular in the next 5 to 10 years.

Further career development and building professional networks. Experienced venture capitalists have analyzed countless startup companies and gained valuable insights into what it takes for a startup to achieve unicorn status. If they decide to transition to a role within a startup company, they can leverage this knowledge to make critical contributions to the company’s success. Additionally, VCs frequently meet with the most innovative individuals in the world – startup founders. This provides an opportunity to build a network of highly skilled professionals across a range of industries.

4.2. Drawbacks of VC Industry

Investing in venture capital comes with several risks that investors should be aware of. Here are some of the most significant ones:

Possibility of losing the entire investment: An investment in a startup can become illiquid, meaning that a liquidity event such as a sale or Initial Public Offering (IPO) may not be possible due to securities legislation, the lack of an active market for the company’s shares, or the company’s failure to generate sufficient revenue for an exit strategy. With a long-term investment horizon, investors may be unable to sell their securities until an IPO occurs or they find a buyer, adding to the risk. It is therefore essential to consult with a financial advisor regarding financial goals and investment portfolios.

Weak chances of advancing to the senior position. The top management in VC firms usually consists of one or two individuals. Since it takes years, or even decades to make profits or earn a carry, there’s a huge possibility of not being able to advance in the hierarchy for a long time – especially without a proven track record, owned by VC Firm leaders. Have in mind that many VC firms have no interest in introducing new general partners; they’d rather split the return among fewer parties. 

Majority of gains go to minority of team members. Working in a VC firm can make you spend years earning money for others. Even if you’re paid fairly high, the management company can get 99% of all the returns, regardless of the fact that you have sourced a startup that became extremely successful.

The VC industry is fiercely competitive. Although it is not difficult to identify promising startups, especially with previous experience, the real challenge is to win and source the best deals. Only a few venture capitalists can find and source more than one unicorn in a couple of years. It takes a significant effort to convince founders to choose your VC over other, more established firms.

Unforeseeable difficulties are common in the VC industry . There are three types of potential barriers that can hinder long-term returns. The first type is related to economic factors, such as a recession. The second type is related to legislation and government regulations, particularly if a VC firm deals with neobanks or crypto-related companies. The third potential risk is related to intellectual property and possible patent infringements.

Investors need to be accredited. Investors who wish to engage in private offerings, including VC investments, must be accredited according to the Securities and Exchange Commission (SEC). This requirement is intended to protect investors by limiting such offerings to individuals who can absorb potential losses and manage the potential illiquidity of VC assets. To meet the criteria for accredited investor status, an individual must have earned more than $200,000 in each of the last two years, or have a net worth of over $1 million.

5. Legal, Regulatory, and Taxation Implications

5.1. legal aspects of venture capital.

Venture capital funds (and private funds in general) are regulated by a number of federal laws that define how VCs raise financial resources, set up a legal entity, and provide services to other investors (limited partners). Venture capital is under the jurisdiction of the Securities and Exchange Commission (SEC).

The following criteria need to be met in order to qualify as a VC fund exempt from SEC registration requirement, according to The Advisers Act of 1940 , and The Investment Company Act of 1940 :

• No more than 20% of fund’s capital is invested in non-qualifying assets, which include debt, secondaries, fund-of-fund investments, Initial Public Offerings, or digital assets.
• A maximum of 15% of the fund’s size should be based on borrowing; all leveraged debts need to be repaid within 120 days
• The fund represents to existing and potential investors that it follows a venture capital strategy – which includes aspects such as stage of investment and industry
• Limited partners are able to cash out of the fund only in “extraordinary circumstances”.
• The fund must not be publicly offered and needs to have less than 100 owners, all of which are accredited investors
• In case owners are not accredited, the fund must not manage more than $10 million and needs to have fewer than 250 owners
• It can be any fund not publicly offered, but all investors need to be qualified purchasers
• The fund can have a maximum of 1,999 investors

Provided that funds meet above criteria, they are exempt from the requirement to register with the SEC, in contrast to mutual funds or closed-end funds. The latter are allowed to collect investment capital from the general public, but are subject to extensive compliance requirements. 

Since the majority of VC funds are not required to register with the SEC, more regulatory 

requirements are imposed on VC fund managers. Different regulations apply based on the size of fund manager’s assets under management: 

• If size of assets under management does not exceed $25 million, the fund manager is qualified as a small adviser and is regulated by the state regulator
• If size of assets under management is between $25M and $100M, the fund manager is qualified as a mid-size adviser and is regulated by the state regulator or SEC
• If size of assets under management exceeds $100 million, the fund manager is qualified as a large adviser and is regulated by the SEC

Depending on circumstances, fund managers can also qualify as exempt reporting advisers and avoid regulatory requirements: 

• In case fund manager strictly advises private funds with total assets under management of less than $150 million
• In case fund manager strictly advises venture capital funds

However, the exempt reporting advisers are still required to complete the Form ADV , containing information about the fund manager and business operations details. Both categories, registered and reporting advisers, can be subject to examination by both the SEC and state-level regulators. 

When it comes to SEC-registered fund managers, they are obligated to file Form PF in case their assets under management exceed $150 million. This reporting document provides all the information about the size of the fund, liquidity, and number of investors. 

Fundraising by venture capital funds is regulated by Regulation D that outlines how the private capital is raised – specifically through Rule 506(b) and Rule 506(c). According to this, VC funds are able to raise unlimited capital, provided that investors are accredited. On the other hand, Regul ation S defines how companies can sell their shares to investors outside the United States. 

5.2. Taxation Aspects of Venture Capital

VC funds are in most cases structured as limited partnerships. As such, these legal entities fall into the category of “pass-through” entities, which means the business itself is not liable for income taxes, but the liability is passed over to each business owner – in this case, general partners (GP), and limited partners (LP). 

The taxation amount depends on multiple factors, such as the timespan during which the funds hold an investment prior to liquidating it, the gross income, and the type of income reported. 

What Gets Taxed in a VC Fund?

Realized Gains. Both general and limited partners are required to pay taxes on their share of VC Fund’s income. If the VC fund was holding assets for less than three years, the returns associated will be treated as a short term capital gain, with a maximum tax rate of 37%. In case the fund was holding the assets for more than three years, the associated returns on the investment are treated as long-term gains and will be subject to a maximum tax rate of 20%. The exact tax rate depends on the adjusted gross income of each partner. 

Management Fees. The net income generated from general partner’s management fees is subject to standard income tax rates in the United States. 

Carried interest / Carry. A fixed percentage of VC funds profits (known as “Carry”), paid to general partners as a compensation for providing ROI to limited partners, is considered by law as a return on investment and taxed as a capital gain. 

The Internal Revenue Service (IRS) requires both general and limited partners to report their profits or losses using a Schedule K-1 IRS form . In case the invested company closes down, implying that there is no return on the investment, the general partners are able to write off that investment.

6. Venture Capital and Web3 

6.1. how vc financing works in crypto and web3 industries.

Venture capital financing in the Web 3.0 industry is rather similar to traditional VC funding, except for one detail that makes a huge difference – VCs are investing in blockchain and cryptocurrency projects. Bearing in mind the regulatory guidelines that are still developing, as well as the need for longer investment lock-up periods, venture capital in the Web3 space implies even more risk.

Another important aspect is the fact that Web3 companies rely on new, more “democratic” ways of raising capital, such as Initial Coin Offerings (ICO), and more recently Initial DEX offerings (IDO). Additionally, the emergence of Decentralized Autonomous Organizations (DAO) allows startup founders to stop relying on VCs and traditional fundraising models, and obtain capital from the investment vehicle run by the community. 

These Web3-powered models of raising capital were somewhat controversial in the past and had their own setbacks, but the development of more sophisticated frameworks and tools made possible for the concepts not to be abandoned.

Nevertheless, an increasing number of VC funds and institutional investors are showing interest in web3, crypto, and blockchain-related businesses. This surge in interest is largely driven by the high potential for growth and disruption, making them attractive opportunities for investors looking to diversify their portfolios and capitalize on the potential for high returns.

6.2. How Web3 Can Disrupt Venture Capital 

Venture capital firms do not solely provide financing to startups; they also offer an array of additional services that are essential for their success. These services include legal support, consulting, marketing, recruiting, and more.

The web3 startup ecosystem operates on unique community-driven mechanisms, lacking a central authority to make decisions. These mechanisms rely on community voting recorded on the blockchain, resulting in a paradigm shift for traditional venture capital firms. To remain relevant in the web3 era, venture capitalists must engage more actively with these communities to partake in investment opportunities.

In essence, the web3 revolution is challenging venture capitalists to rethink their strategies and adapt to new market dynamics to remain competitive. Only those who embrace these changes and leverage innovative approaches will succeed in this rapidly evolving landscape.

The traditional venture capital model must demonstrate its value proposition for emerging web3 projects and present a compelling case for why it is superior to community-driven, decentralized fundraising models such as investment DAOs. To adapt, VC firms are already exploring alternative models, such as transforming into DAOs themselves. Another example of web3 disruption is the Unique.vc platform, enabling investors to create or join VC funds and leverage blockchain technology to manage them.

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Investing in venture capital funds, vehicles, or companies is inherently risky and illiquid. It involves a high degree of risk and is suitable only for sophisticated and qualified investors. The performance of past deals or a lead investors’ track record is not a guarantee of future returns.

The information contained herein is provided for informational and discussion purposes only and is not intended to be a recommendation for any investment, service, product, or legal, tax, or financial advice of any kind, and shall not constitute or imply an offer of any kind.

All examples of past investments featured are purely for illustrative purposes only and do not reflect the entirety of investments made on the Unique.vc platform. There is no guarantee that any fund, syndicate, or company will achieve the same results.

Views expressed in “posts” (including blogposts, podcasts, videos, and social media) and those of the individual Unique.vc personnel or guest authors quoted therein and may not be the views of Unique.vc.

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Venture Capital Funds: Definition for Investors and How It Works

James Chen, CMT is an expert trader, investment adviser, and global market strategist.

What are Venture Capital Funds?

Venture capital funds are pooled investment funds that manage the money of investors who seek private equity stakes in startups and small- to medium-sized enterprises with strong growth potential. These investments are generally characterized as very high-risk/high-return opportunities.

In the past, venture capital (VC) investments were only accessible to professional venture capitalists, but now accredited investors have a greater ability to take part in venture capital investments. Still, VC funds remain largely out of reach to ordinary investors.

Key Takeaways

• Venture capital funds manage pooled investments in high-growth opportunities in startups and other early-stage firms.
• Hedge funds target high-growth firms that are also quite risky. As a result, these are only available to sophisticated investors that can handle losses, along with illiquidity and long investment horizons
• Venture capital funds are used as seed money or "venture capital" by new firms seeking accelerated growth, often in high-tech or emerging industries.
• Investors in a VC fund will earn a return when a portfolio company exits, either through an IPO, merger, or acquisition.

Understanding Venture Capital Funds

Venture capital ( VC ) is a type of equity financing that gives entrepreneurial or other small companies the ability to raise funding before they have begun operations or started earning revenues or profits. Venture capital funds are private equity investment vehicles that seek to invest in firms that have high-risk/high-return profiles, based on a company's size, assets, and stage of product development.

Venture capital funds differ fundamentally from mutual funds and hedge funds in that they focus on a very specific type of early-stage investment. All firms that receive venture capital investments have high-growth potential, are risky, and have a long investment horizon. Venture capital funds take a more active role in their investments by providing guidance and often holding a board seat. VC funds, therefore, play an active and hands-on role in the management and operations of the companies in their portfolio.

Venture capital funds have portfolio returns that tend to resemble a barbell approach to investing. Many of these funds make small bets on a wide variety of young startups, believing that at least one will achieve high growth and reward the fund with a comparatively large payout at the end. This allows the fund to mitigate the risk that some investments will fold.

Operating a Venture Capital Fund

Venture capital investments are considered either seed capital , early-stage capital, or expansion-stage financing, depending on the maturity of the business at the time of the investment. However, regardless of the investment stage, all venture capital funds operate and are regulated in much the same way.

Like all pooled investment funds, venture capital funds must raise money from outside investors prior to making any investments of their own. A prospectus is given to potential investors of the fund who then commit money to that fund. All potential investors who make a commitment are called by the fund's operators, and individual investment amounts are finalized.

From there, the venture capital fund seeks private equity investments that have the potential of generating large positive returns for its investors. This normally means the fund's manager or managers review hundreds of business plans in search of potentially high-growth companies. The fund managers make investment decisions based on the prospectus' mandates and the expectations of the fund's investors. After an investment is made, the fund charges an annual management fee, usually around 2% of assets under management ( AUM ), but some funds may not charge a fee except as a percentage of returns earned. The management fees help pay for the salaries and expenses of the general partner. Sometimes, fees for large funds may only be charged on invested capital or decline after a certain number of years.

Venture Capital Fund Returns

Investors of a venture capital fund make returns when a portfolio company exits, either in an IPO or a merger and acquisition. Two and twenty (or " 2 and 20 ") is a common fee arrangement that is standard in venture capital and private equity. The "two" means 2% of AUM, and "twenty" refers to the standard performance or incentive fee of 20% of profits made by the fund above a certain predefined benchmark. If a profit is made off the exit, the fund also keeps a percentage of the profits—typically around 20%—in addition to the annual management fee. 

Though the expected return varies based on industry and risk profile, venture capital funds typically aim for a gross internal rate of return around 30%.

Venture Capital Firms and Funds

Venture capitalists and venture capital firms fund several different types of businesses, from dotcom companies to biotech and peer-to-peer finance companies. They generally open up a fund, take in money from high-net-worth individuals, companies seeking alternative investments exposure, and other venture funds, then invest that money into a number of smaller startups known as the VC fund's portfolio companies.

Venture capital funds are raising more money than ever before. According to financial data and software company PitchBook , the venture capital industry invested a record $136.5 billion in American startups by the end of 2019.   The total number of venture capital deals for the year totaled nearly 11,000—an all-time high, PitchBook reported. Two recent deals included a $1.3 billion investment round into Epic Games, as well as Instacart's $871.0 million Series F. Pitchbook also cited an increase in the size of funds, with the median fund size rounding out to about $82 million, while 11 funds closed out the year with $1 billion in commitments including those from Tiger Global, Bessemer Partners, and GGV.

https://nvca.org/pressreleases/us-venture-capital-investment-surpasses-130-billion-in-2019-for-second-consecutive-year/

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VC 101: A Guide to Venture Capital for RIAs

Chief business development officer jack barlow explains why vc is an important asset class for investors to consider.

Alumni Ventures

April 30, 2024

In the evolving investment landscape, venture capital stands out as a unique asset class, offering wealth managers and financial advisers an opportunity to further diversify their clients’ portfolios beyond traditional stocks, bonds, and the growing options for core alternative assets. In this on-demand webinar, we explain why a VC firm’s expertise, like that of Alumni Ventures, is crucial in guiding RIAs through investing in this high-potential asset class, leveraging their experience to identify promising startups.

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About Our Panel

Jack Barlow

Jack has over 20 years of experience in the asset management industry mainly oriented around the development and distribution of traditional private and open-ended alternative investment solutions to the wealth management community. He has worked across all major financial intermediary channels, including global private banks, national brokerages, registered investment advisers, and independent broker/dealers. Most recently, he helped lead BlackRock’s effort to bring its private market franchise to wealth including the launch of four evergreen solutions covering private credit, private equity, and hedge fund strategies. Prior to BlackRock, Jack was one of the original members of Blackstone’s Private Wealth Solutions team where he co-led the national account effort. Earlier in his career, he held corporate positions with Bank of America’s Alternative Investment Group, FleetBoston Financial, and management consulting. Jack has an Economics degree from Hobart College and an MBA from University of Chicago’s Booth School of Business.

Edward Tsai

Edward has 15+ years of investment experience in the U.S. and China, including a successful track record with investments such as Cruise Automation (acq. by GM), Life360 (IPO), Palantir (IPO), and Brave Software. In addition, Edward has served on the limited partner advisory committees at Cendana Capital and Ten Eleven Ventures, and he has deep operating experience at tech and cybersecurity companies. Most recently, he was Director of Investments at enterprise security company Qianxin, where he led $700 million in fundraising, ran multiple M&A deals, and managed a large investment portfolio. As Assistant GM for Qianxin, he also incubated their cybersecurity spinout fund Security Capital. At 360, he led International Investments and Strategic Development. He started his venture career as Vice President at DCM, a global early-stage VC firm managing $4 billion. He holds BS and MS degrees in Computer Science from UCLA, where he is a Kauffman Fellow (class of ’15).

Learn About Our Offerings for Wealth Managers

Alumni Ventures provides a range of solutions for wealth managers who want to maintain a competitive edge. Venture capital can bring multiple benefits to your clients’ alternative assets. Click below to discover more.

Contact  [email protected]  for additional information. To see additional risk factors and investment considerations, visit  av-funds.com/disclosures .

Alumni Ventures is a network-powered VC firm that helps accredited individuals invest in venture capital.

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Reporting by Suzanne McGee; Additional reporting by Dhara Ranasinghe in London; Editing by Ira Iosebashvili, Michael Erman and Jamie Freed

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