I continue to be amazed at the content available for emerging GPs. This month, the content comes in the form of blog posts, but also zoom webinars and live audio talk shows.
I first heard Beezer Clarkson from Sapphire Ventures being interviewed on Semil’s Talkshow (listen here) on March 11th. It was right after on Mar 14th that Samir Kaji posted his article “What I’m hearing in venture right now“, where he touches on fundraising for both startups and VCs. The next day he posted an article specific to Micro VC funding. Two days later, Lo Toney from Plexo Capital did his version of the Sequoia Black Swan article, but for GPs: The Economic Impact of Coronavirus: What GPs Need to Know. Another two days later, Jim at SVB hosted a Zoom webinar: Fundraising for Emerging VCs Post-Coronavirus, where he interviews three LPs – Joanna Rupp at University of Chicago, Michael Kim at Cendana, and Lindel Eakman at Foundry Group. I also enjoyed Michael Kim being interviewed on Strictly VC (here – Mar 20) and found Samir’s Emerging Manager Q&A mailbag from March 23rd a nice deep dive. Finally, Connie Loizos at Techcrunch shares wisdom from experienced GPs like Charles Hudson from Precursor, Eva Ho from Fika, and Aydin Senkut from Felicis: ‘A perfect storm for first time managers,’ say VCs with their own shops.
I know that’s a lot, so I’ll summarize a few take aways:
- It’s a great time to invest. Great startups are founded during recessions. Congrats if you have dry powder.
- Fundraising will be tough for GPs, especially new ones. Considerations for LPs include general uncertainty, desire for liquidity, allocation (esp. institutional), returning funds, and lack of in person meetings making it tough to build trust.
- For existing funds, an important time to support portfolio companies, communicate with LPs (esp. around expected capital calls and distributions), and review reserve strategy (eg. what percent of your companies need help, and how many can and should you support if they need a life line).