How Venture Capital Has Changed Since Covid-19

SaaStr

Q: How is Venture Capital difference since Covid-19? Every fund one way or another got used to investing over Zoom. At first, funds invested in founders they already knew. The next wave was adjusting and investing in founders they hadn’t met face-to-face.

How Would a Person Start a Venture Capital Fund?

SaaStr

If you haven’t already made some good investments — it’s going to be tough to start your own fund. Go work at a fund first and make some good investments there. Start Small before your start a Venture Capital Firm. Grow within a Venture Capital Firm.

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The Pros and Cons Of Working in Venture Capital

SaaStr

Q: What are the pros and cons of working in the venture capital space, and why? I’ll list the pros and cons, but before we get there, it’s important to note a few things: Venture Capital is a tiny industry. There are very limited promotion paths in venture.

What’s Really Happening in Venture Capital, Right Now

SaaStr

Q: Are Silicon Valley VC firms suspending or significantly cutting down on startup investments during this pandemic given the vast economic uncertainties of this time, or is it business as usual? VCs have not fully adjusted to remote investing.

Passive Investing in Venture Capital and the Parallels to Public Equities

Tomasz Tunguz

Passive venture capital investing is a relatively new idea. As later stage investors permeate venture capital, they are amassing index funds of startups. If the public equities market is any indication, passive investing is here to stay.

Do I Need To Raise Venture Capital At All? No. But It Takes Longer If You Don’t.

SaaStr

Q: Is venture capital really necessary to do a start-up? Squarespace’s solo CEO managed to go years without taking any investment at all. Atlassian never raised any primary capital and waited many years until raising money at all for secondary liquidity.

Why Do Some People Consider Venture Capital a “Young Person’s Game”?

SaaStr

At least from very early-stage investing. It doesn’t take that long in venture to make a decent salary. Invest in seed round of Procore in 2003. Finally, today, that investment is worth a lot. So an incredible, hypothetical investment.

Webinar: What’s Going On in Venture Capital Right Now with Byron Deeter, Bessemer Venture Partners

SaaStr

Next in this series is one of the community’s favorite speakers, Byron Deeter of Bessemer Venture Partners. Byron started off as a SaaS CEO and has invested in probably more SaaS IPOs than any other VCs, from Twilio to Sendgrid to oldies like Eloqua and Cornerstone OnDemand.

Venture Capital in 2020/2021 and “The Postmates Effect”. I.e., It’s OK to Be #2 or #3 Now.

SaaStr

He said the biggest change in venture capital wasn’t investing over Zoom, or Cloud multiples, or even the pace of investing today. No, the biggest change in Venture Capital in 2020-2021 is what he called “The Postmates Effect” That Postmates was arguably #3 to Doordash and UberEats, and still was worth billions. Look at the dozen+ VC investments in second tier digital events software companies since Covid.

The Figures that Will Move the Venture Capital Market in the Next 5 Years

Tomasz Tunguz

What does it mean for venture capital and Startupland? Let’s examine the relationship between total venture capital investment and the 10 year Treasury in some detail. As the interest rate approaches zero, venture capital spend approaches infinity.

How do corporate venture capital firms different from conventional venture capital firms?

SaaStr

A few like Salesforce Ventures and GV are an exception, but let me explain: Corporate VCs often do not write a “second check”. Again, this is less likely with Salesforce Ventures and GV, etc. If you have a critical partner, it can help bond you closer if they invest. They can invest odd and smaller amounts, and sometimes, between rounds. But if the motivation to invest is in part or largely strategic, you won’t be pushed as hard on valuation.

Just How Inaccurate are Quarterly Venture Capital Activity Reports?

Tomasz Tunguz

Each quarter, a group of analysts, including me, publish analysis on the trends in the venture capital market. Moving onto total dollars invested, the lines hug each other closely. The total invested in the seed market shows an uptick in the Q4 data.

How Bridge Rounds Work in Venture Capital: Messy, Full of Drama, and Not Without High Risk

SaaStr

I’ve watched many bridge rounds over time from a far, and took $500k in bridge capital at EchoSign myself when our seed round didn’t end up being quite enough to get us to the Series A. That’s mainly because over the past 2 years I’ve invested in more early-ish seed companies (vs later seed companies), that often end up needing a second seed, or bridge. Simply put, it’s another round of venture financing from the same investors as the last round.

How do venture capital firms determine when and how to help stalled or stuck portfolio companies?

SaaStr

Q: How do venture capital firms determine when and how to help stalled or stuck portfolio companies? And then generally reserve some extra cash if you are doing OK but not great, often another 25% more than the initial investment for a bridge or small second check if that gets you over the help. And almost any VC can afford to write off at least 20%-40% of their investments.

What Makes a Start-up Stand Out as a Venture Capital Opportunity? Lessons for 2021–2022

SmartKarrot

What makes a start-up attractive to venture capitalists? More specifically, are there any key performance indicators (KPIs) that VCs check for before investing; the answer is slightly complex. Of this, just 20 eventually go on to receive investments — this means that there’s just a 0.7%

Why has Skype co-founder Niklas Zennstrom’s venture capital firm raised over 800 million to back European startups?

SaaStr

Q: Why has Skype co-founder Niklas Zennstrom’s venture capital firm raised over 800 million to back European startups? 20m x 20 initial investments = $400m. another 50% for follow on investments (another $400m) = $800m. Just 20 investments have taken it all up.

What are the key differences between venture debt and venture capital?

SaaStr

Venture capital / equity is expensive. But … with few exceptions, it’s 100% risk capital. And VCs are OK in the end writing off up to 40% of their investments. Venture debt is relatively cheap. But whatever the terms, venture debt is much, much cheaper than equity / venture capital. But the thing is, venture debt has to also be much lower risk. The post What are the key differences between venture debt and venture capital?

How Developed is Global Venture Capital Market?

Tomasz Tunguz

Just where is the US venture market relative to the rest of the world? The chart above shows the compound annual growth rate of venture investment rounds A through D in ten fastest growing venture markets plus the US from 2010-2016. It’s wonderful to see the expansion of venture capital across these geographies and especially at very healthy growth rates. in investment is 6% of the US market. invested in 2016, with a growth rate of 19%.

How Revenue-Based Financing and Venture Capital Funding Work Together

OPEXEngine

As Chief Credit Officer at Lighter Capital, I work behind the scenes grappling with the data that informs all of our decision-making regarding financing deals, from revenue-based financing (RBF) to term loans and lines of credit. Similar to a venture capitalist (VC), I try to understand where startups are in their life cycles — and where they can expect to go. Is RBF simply an alternative to venture capital funding? Lower-cost capital post-VC funding.

How do venture capital general partners resolve investment choice disagreements? If a number of partners think a certain startup is a good portfolio candidate and others don’t agree, what happens?

SaaStr

The more junior the partner, or investing professional, the more she/he needs others to buy-in. Smaller investments (measured as a % of fund size) often don’t require as much buy-in. An investment < 0.5% Most funds believe the best companies were less obvious investments. Are any of her investments “hot deals” yet? The post How do venture capital general partners resolve investment choice disagreements? It varies.

The Decentralization of Venture Capital

Tomasz Tunguz

To thrive, venture capital firms must perform three things well: raise capital from limited partners, source companies to invest in, and pick the best opportunities. In the last decade, venture firms have experimented with decentralized sourcing. Each represents a different type of effort to scalably uncover new investment opportunities. The investment decision process is decentralized: each anonymous investor votes.

How hard is it to raise venture capital? If you have solid traction and a great team, are your chances significantly higher than 0.05% and will you find at least one investor if you keep hustling?

SaaStr

Q: How hard is it to raise venture capital? The overall odds of raising venture capital may be 0.05%. According to YC, “Each batch of YC companies raises about $250M of seed capital in the weeks following Demo Day.” Find a way to go 24+ months without VC capital.

Why we invested in Athenian

Point Nine Land

Why we invested in Athenian was originally published in Point Nine Land on Medium, where people are continuing the conversation by highlighting and responding to this story. p9family engineering saas software-development venture-capital

Are VCs Still Investing?

Point Nine Land

At the same time, tech companies are better off than any other industry, and, to answer the question posed in the headline, VCs are still investing (we’re one of them). startup technology venture-capital saas covid19

Raising Funding During COVID with Homebrew Partner Satya Patel (Video + Transcript)

SaaStr

I’m here to talk to you today about raising capital in today’s environment, particularly at the seed stage, so we’ll touch on the Series A stage as well. That’s a good place to start, to understand the actual landscape in which you are trying to raise capital.

Hyper-growth is great, but don’t die while trying

Point Nine Land

To achieve its ambitious growth targets, Acme is going to spend aggressively on sales and marketing while continuing to invest in R&D. If things go well, these expenses are investments that will yield a great return and will lead to a defensible business in the long run.

Corporate VC Investments: Limited, But Real, Pros. And Cons.

SaaStr

These are the Best of Times for venture capital. And as part of this, more and more big corporations are adding and expanding their venture arms. Traditional VCs usually reserve another 1x-2x of their first check for later investments.

The Midas List Live (Video + Transcript)

SaaStr

A discussion about venture capital and the effects Covid-19 has had on in the industry. Nicole Quinn, general partner of Lightspeed Venture Partners and Ann Miura-Ko, co-founding partner of Floodgate and I’ll hand it over to you. We primarily invest sort of series A stage.

Kellblog Predictions for 2022

Kellblog

Before diving in, let me remind readers that I do these predictions in the spirit of fun, they are not business or investment advice, and that all of my usual disclaimers and terms apply. Flood of venture capital (VC). Venture capital continues to flow.

Investing in ClickUp

Andreessen Horowitz

In venture capital, conventional wisdom and decades of startup history tell us that founding companies in crowded spaces is extremely hard.

Loom: Love at first sight

Point Nine Land

There is this idea in the VC community that investors usually know after the first meeting (or maybe even after the first five minutes) if they want to invest in a company. When we found out about Loom in February 2017, we knew almost immediately that we wanted to invest.

Why Execution Matters

Kellblog

But you’re not fully committed, the board is split on the decision, you’re worried about the CAC impact of initially unproductive sales investments, and you’re not sure what to do. Management Marketing Startups Strategy Venture Capital execution

How to Lead a Strategic Board Discussion

Kellblog

In high school, they were in the investing club. Board CEO CFO Silicon Valley Strategy Venture CapitalHave you ever been to a board meeting where 60 minutes were allocated on the agenda for discussion of a strategic topic? What happened in that session?

Hi from David at P9

Point Nine Land

After wrapping up my degree, I joined the epic team at Seedcamp on their internship program where I totally immersed myself in the European tech ecosystem and learned a lot about early stage investing. startup saas marketplaces emerging-markets venture-capital

When a VC Investment Fails, Does That Mean It Was a Bad Investment? Probably Not

SaaStr

With venture capital investments that fail, is the problem most often with the entrepreneur or was it a bad investment by the VC? The earlier stage you invest, the more often some of them just … don’t work out. Especially when you invest early.

Why I’m Joining Balderton as an Executive-in-Residence (EIR)

Kellblog

I’m thrilled to announce that I’ll be joining Balderton Capital on a part-time basis to work with the firm and its portfolio companies on topics related to enterprise software, strategy, go-to-market, marketing, and SaaS metrics. SaaS Silicon Valley Startups Venture Capital

Corporate VC Investments: Limited, But Real, Pros. And Cons.

SaaStr

These are the Best of Times for venture capital. And as part of this, more and more big corporations are adding and expanding their venture arms. Traditional VCs usually reserve another 1x-2x of their first check for later investments.