VC Portfolio Support Strategy

Shortening VC Learning Cycle

Hi Guys,

Hope you all are doing great and having a great time.

This week's newsletter covers pieces around building a successful portfolio support strategy.

Some of the relevant content related to VC portfolio strategy that I have recently come across and presently using it in my work at Moonshot Ventures: 

• Bloomberg Beta Open Source Operating Manual: https://github.com/Bloomberg-Beta/Manual/blob/master/1%20-%20Manual.md#the-deal-terms

• Different kinds of Portfolio support strategy in the VC world:

  • Act as a Hedge fund - invest and leave the portfolio - in theory, it is a more scalable strategy. E.g., Correlation Ventures

  • Mentor strategy -systematic, standardized support - this is the best working strategy - Historically proven approach - it's a relatively low cost

  • Portfolio Operator Strategy - requires a significant investment of capital - a lot familiar in PE world

• Main themes/areas of support:

  • Recruiting

  • Outsourced Financial Services - especially for tech startups

  • Service Providers - PR firms, legal firms, SEO firms - it takes a lot of money in advance - late-stage VCs do that

  • Templates of how to build your company

• Listen to David Teten's thoughts on Portfolio Support Strategy:  

• VC Platform Strategy: https://medium.com/startup-grind/why-do-vc-firms-become-platforms-or-why-a16z-is-so-successful-be12b2d7ce2e#.ysfwlmmj8

  • A lot of VCs call these as beyond capital support as "platform," e.g., https://www.frontline.vc/platform, and many are calling it a platform approach to VC. 

• Research/ White Paper on Portfolio Strategy:  https://www.caia.org/sites/default/files/membersonly/The_Lower-Risk_Startup.pdf

• Beyond capital: VC firms use their Platform strategy as an additional differentiator in a market that has become over-competitive. https://openviewpartners.com/blog/truth-vc-value-add/#.XarPsJIzbB

With Love,

Sagar

About

"first followers" is founded by Sagar Tandon, a founding member at Moonshot Ventures. You can reach him at sagar@moonshotventures.org.

Occasionally, he blogs about the responsible investing, tech for good, venture capital, investment thesis, conscious capitalism, collaborative consumption, community, and humane lifestyle. To read his blogs, please visit humane.network.