Author: Decile Group

The Decile Group develops industry-leading offerings to transform venture capital into an ethical force for good in the world, including VC Lab, Decile Hub, Decile Partners and Decile Capital.

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Insights

VC Management Fees

Venture investing has become a hot commodity among high net worth individuals, but the allure of high-risk and high-reward opportunities comes with a cost. After all, venture capital funds have to employ talented people to scope, identify, invest in, and support early-stage companies. This is why venture capital management fees are so important—they don’t just keep the lights on, but create an incentive for venture firms to grow. In this article, we will delve into fees—and along the way, we’ll explore their purpose, structure, and the factors which impact their calculation. What are Management Fees? Venture capital management fees generally come in one of two flavors:  A fixed percent which a firm charges investors to compensate for the services they provide, which is what many investors and fund managers think of when they hear the phrase “management fees.”…
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Insights Venture Institute

The Venture Institute: The VC Career Launchpad

VC Lab is launching Venture Institute, a completely free, venture capital training program designed to train and educate the rising tide of new venture capital leaders. The venture institute program consists of two months of focused training, plus an additional two months of practical on-the-job experience, which aims to enrich the knowledge base of venture professionals reserved for the top performers of each cohort. Unlike other venture capital programs, such as Kauffman Fellows and Venture Unlocked, Venture Institute is completely free. The program is open to all, and participation will be limited only by the size of the program. Strong participants can expect to receive job offers in venture capital after the conclusion of the program. Apply to Cohort 6 Table of ContentsVenture Institute AMA VideoWho is the Venture Institute for?What…
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Insights LP Institute Resources Venture Capital Operations Venture Capital Strategy Venture Institute

Venture Impact Metrics

A “For Progress” company is a business directly aligned with one or more United Nations Sustainable Development Goals (SDGs), focusing on creating measurable impacts on global challenges through its mission, products, or services. This model applies to both for-profit and non-profit entities, fostering a universal impact-driven approach to business.  Initially intended for national governments, the United Nations Sustainable Development Goals (SDGs) have expanded to encompass the private sector. To accommodate this shift, an initiative led by the Founder Institute translated the SDGs into metrics called impact Key Performance Indicator (iKPIs) that businesses, startups, and venture capitalists can address. This new approach bridges the gap between the SDGs and the entrepreneurial sector, providing a framework for private entities to align their goals with global sustainability targets and measure their contribution, fostering a culture of accountability, transparency, and improvement.…
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Insights

Impact Venture Funds

An impact venture fund is a type of investment fund which aims to generate both financial returns and positive social or environmental impact. These funds are part of the broader trend towards impact investing, which incorporates environmental, social, and governance (ESG) factors into investment decisions. Impact-focused venture funds have been gaining traction in recent years, with an increasing number of fund managers and investors recognizing the potential for startups to drive significant social and environmental change. This guide provides an overview of impact fund Thesis examples, methods to measure impact, pros and cons of starting an impact fund, and strategies for attracting and closing interested limited partners. Key Sectors for Impact Funds Impact-focused venture funds often align their investment strategies with sectors that contribute to the United Nations Sustainable Development Goals (SDGs), which address global societal and environmental challenges.…
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VC Lab Programs Insights

VC Lab Cohort 11

VC Lab, the leading venture capital accelerator program, continues to innovate on helping managers launch and build enduring venture capital firms with Cohort 11. New and emerging managers are guided to close on capital in an average of 5.7 months – three times faster than industry norms. By offering a robust, battle-tested curriculum of weekly closing activities, providing mentorship sessions with leading VC talent, conducting informative weekly AMAs, and cultivating a supportive community, VC Lab is raising the bar. It doesn’t end there. With market-leading tools to build and manage a VC firm, the program covers all bases. VC Lab’s program is tailored to support various types of new and emerging managers. From angel investors looking to expand their portfolio to successful entrepreneurs and professionals wanting to leverage their network and skills in the VC space, the program is versatile and inclusive.…
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Insights Resources Venture Capital Fund Formation Venture Capital Strategy

The Power of Track Record

In the world of venture capital, the phrase “past performance is no guarantee of future results” does not hold true. When it comes to raising funds for a new venture capital (VC) firm, a manager’s track record can be a significant determining factor for investor interest. This article outlines the critical elements of a manager’s track record and explores why it is essential for starting a venture capital firm. The Importance of Track Record A venture capital firm is essentially an investment vehicle. At the helm of this vehicle is the fund manager, whose decisions about which startups to invest in largely determine the success or failure of the venture. Therefore, when limited partners (LPs) are deciding whether to invest in a venture capital firm, one of the most critical factors they consider is the manager’s track record.…
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Limited Partners Insights Resources Venture Capital Operations

Leveraging Connectors to Source Limited Partners

In the world of venture capital, ‘Connectors’ are individuals with an extensive network of potential investors or limited partners (LPs). They serve as a bridge between general partners (GPs) at venture capital firms and potential LPs, facilitating introductions that could lead to fruitful partnerships. However, for GPs looking to raise capital, especially those at new and emerging venture capital firms, it is crucial to understand and navigate the delicate terrain of securities laws to avoid triggering general solicitation. The Role of Connectors Connectors, individuals who maintain expansive networks encompassing wealthy individuals and potential limited partners, serve as conduits between general partners of venture capital firms and potential investors. With their broad connections, Connectors can provide access to an array of potential limited partners that might otherwise be challenging to reach.…
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Insights Resources Venture Capital Fund Formation Venture Capital Operations Venture Capital Strategy

VC Capital Calls

A capital call is a request made by a venture capital fund to its investors to contribute capital to the fund. This is typically done when the fund needs additional funds to make investments or to cover its ongoing expenses. Capital Calls are commonly paid by the Limited Partners as defined by the Limited Partner Agreement (LPA). Capital Calls are a crucial aspect of venture capital investing, as it enables the fund to make new investments that generate returns for its investors. However, it can also be a source of risk, as investors must be prepared to provide the capital requested, even if they may not have anticipated the need for additional contributions. This comprehensive guide provides an in-depth overview of capital call processes, management, strategies, risks, and best practices.…
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Venture Capital Fund Formation Insights Resources Venture Capital Operations Venture Capital Strategy

VC Fund Closing Times

Venture capital fund closures are a seasonal phenomenon, influenced by factors such as holidays, budget allocation schedules, tax seasons, and the geographic locations of limited partners (LPs). Recognizing and understanding these patterns is crucial for both fund managers and their LPs to optimize their planning. In this article, we’ll delve into the best times to close a VC fund, the importance of planning, and how to prepare for the fund closure process. Seasonality of Fund Closures Seasonal patterns significantly venture fund closing timelines. December and January, alongside July and August, are widely regarded as the “funding doldrums” periods. Securing LP funding during these months can be particularly challenging due to holiday celebrations and vacation schedules. Additionally, local and religious holidays may contribute to further funding slowdowns.…
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Venture Capital Fund Formation Insights Limited Partners Resources Venture Capital Operations Venture Capital Strategy

Hard and Soft Commitments for VC

In venture capital fundraising, understanding the distinction between soft circled and hard circled limited partners is crucial. Soft circled partners express interest in investing, while hard circled partners commit to a specific investment amount. This article will outline how to identify soft and hard circled limited partners, guide you through the identification process, discuss the importance of regular communication, and explore the role of geography in closing probabilities to help you maximize your fundraising success. What is Soft and Hard Circled Soft Circled Limited Partners: Soft circled limited partners express interest in investing a specific amount or range, but they typically have additional questions or require further steps to finalize the investment. The probability of closing a deal with a soft circled commitment ranges from 10% to 25%.…
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Insights Limited Partners LP Institute

Meet Decile Capital

VC Lab is proud to announce the launch of Decile Capital, a family of funds set up to invest in promising alumni of the VC Lab program. The inaugural fund, Premier I, invests in the top 5% of new managers launched by VC Lab, which has accelerated 285 VC firms to date from 9,500+ candidates.  Premier I closed in April of 2023 and was oversubscribed. The flagship fund has already backed 6 of 20 target portfolio funds, and Premier I has plans to invest in 14 new funds over the next 12 months. Decile Capital backs funds from the VC Lab accelerator that have been accepted into our Decile Partners firm success program.  The portfolio includes an impact fund in LATAM that has backed a unicorn as well as a fund led by a leading social media influencer focused on social good, 444 Capital.…
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Limited Partners Insights LP Institute Resources

How to invest in Venture Capital

Venture capital (VC) is a critical catalyst for innovation and progress in various sectors, including healthcare, energy, financial services, artificial intelligence, and climate change. As an asset class, venture capital has consistently outperformed others over the past five years, making it an attractive investment option for those looking to diversify their portfolio and contribute to the advancement of groundbreaking technologies and solutions. This article will explore the reasons why investors should consider investing as a limited partner in venture capital funds and guide you through the process. It also includes a glossary of key venture capital terms for limited partners. Venture capital is the top performing asset class, and projections show that it will remain at the top for the next decade.…
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Resources Insights Venture Capital Fund Formation Venture Capital Operations

How to build a Venture Studio

A venture studio, also known as a venture builder, startup studio or startup factory, is an organization that systematically generates, develops, and scales multiple startup companies. Unlike traditional venture capital or incubator models, venture studios are actively involved in the operational aspects of the business. They provide not only capital but also shared resources, expertise, and a network to help startups grow and succeed. How are venture studios structured? Venture studios create distinct legal entities for the parent company and the portfolio companies. It is common for venture studios to have an attached venture fund to finance portfolio companies after launch. When there is a fund, the recommended structure is to have a dedicated management company above the venture studio entity and above the GP and LP entities of the fund (see diagram).…
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Venture Capital Sessions Insights

BitBull Capital: Interview with Joe DiPasquale

Watch the interview with Joe DiPasquale, founder & CEO of BitBull Capital, a crypto hedge fund focused on multi-strategy active management: You can read DiPasquale’s recent guest post on the FI blog here: Top 9 Questions about Investing in Bitcoin, Blockchain, and Cryptocurrencies. Bitbull fund is an open-ended liquid crypto hedge fund that invests not only in liquid crypto assets but also in equity such as Coinbase. Under the leadership of founder and CEO, Joe DiPasquale Bitbull has flourished in many ways. Here’s our interview with Joe DiPasquale. Tell us about your background and experiences, (professional and personal), and how you became active with crypto. I’ve been investing in crypto since 2013. By 2016, I started following full-time on my crypto investments.…
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Insights Limited Partners Resources Venture Capital Strategy

The Venture Capitalist’s Guide to Limited Partners

Overview The VCs guide to LPs covers the core issues GPs may face when trying to prospect, close and interact with Limited Partners. This guide answers the following questions: What’s an LP? What are the common LP types? What’s the ideal LP for my fund? How do I plan my fundraising? How do I find LPs? How many LPs do I need for my fund? How do I size my fund? How do I pitch my fund? How do I do my first close? How do I show traction? Limited Partners This is the Ultimate Guide to VC Limited Partners, brought to you by VC Lab. Our accelerator program helps GPs launch and grow their top decile funds using our proprietary methodology and tools.…
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Insights Next Gen VC Resources Venture Capital Research

Next Gen VC Manager Report

Market Makers of Innovation Download the new report by VC Lab Research NextGen VC Managers – 2023-Q1Download Overview Venture capital functions as research and development for humanity. When done right, venture capitalists fund and support innovative ideas from pioneering founders that change the world for the better. Over the last five years, a couple thousand new venture capital firms have been launched worldwide. By analyzing the profile of the new managers launching these firms, we can glean a forecast of what the innovation of tomorrow will look like.  VC Lab Research collected information from 401 venture capital firms from around the world focused on early stage investing to present a detailed profile. The firms were launched from May 2020 until January 2023.…
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Limited Partners LP Institute Venture Capital Sessions

LP Roundtable

On February 14th, 2023, VC Lab hosted the first LP Roundtable event for limited partners to discuss the venture capital landscape in Q1 2023. Learn how high net worth limited partners interested in emerging managers view the world. Court Lorenzini, founder of DocuSign, and Martin Tobias, successful angel investor, discuss and debate their respective opinions on the current market conditions facing venture capital in the beginning of 2023. The turbulent markets have made investors nervous, but they have also created opportunities. Enjoy! Watch the LP Roundtable below…
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Venture Capital Sessions Insights VC Lab Alumni

Watch Venture Roundtable – January 10th, 2023

Hear firsthand stories about how three diverse managers launched a venture capital firm in 2022. Some key questions answered by the panelists during the virtual session include: What inspired you to start at VC firm? What opportunities excite you the most today and why? What advice would you give yourself? What would you have done differently if you had known today? Connect with the four managing partners below: Karen Sheffield Gbite Oduneye Brian Bell To experience a live event, explore our upcoming offerings at Events.…
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Venture Capital Legal Templates Venture Legal

Cornerstone LPA v2.0

The Cornerstone LPA, the easy-to-use limited partner agreement for venture capital funds, has been upgraded to Version 3. View the changes and download here. Cornerstone V3 Version 1 and Version 1.1 of Cornerstone have been used by hundreds of funds around the world, reviewed by dozens of fund formation attorneys and signed by hundreds of limited partners. The agreement has also been localized to multiple fund domiciles. The widespread adoption of the Cornerstone has provided feedback and ideas to improve the core agreement template. Each week, a diverse team of formation professionals and attorneys discuss the feedback and ideas to validate their merits, ultimately drafting any viable enhancements. Version 2 captures most of these improvements. The following contains an outline of the improvements, instructions to upgrade from previous versions, a detailed change log and the Agreement itself.…
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Venture Capital Trends Insights

A Message of Hope for 2023

Positive change is needed in the world. A renaissance is underway that will bring the change that is needed. It started with entrepreneurship, and it is now expanding to venture capital. Today, there are passionate entrepreneurs working to build a bright future everywhere. They are disrupting antiquated industries. They are building solutions to the grand challenges of our time. They are creating innovations that will take humanity to new levels. The global spread of the entrepreneurial renaissance has not yet been followed by venture capital. While accelerators and angels are operating in most countries around the world, professional sources of capital are isolated to a select few cities, like Silicon Valley, London, New York and Berlin. The few fortunate cities with thriving venture capital ecosystems have seen more change, more innovation and more wealth creation in a virtuous cycle.…