Charito profile picture
Charito profile picture

Charito

Senior Account Exec

Fire Starter
Old School Bravo

Assessing VC firms

Savvy sellers,


Everyone is familiar with the VC business model. Invest in 10 companies and hope 1 or 2 are home runs.


The narrative usually follows something like...


The pressure to scale on a timeline set by investors, not clients, product/market fit or hired management. Goals/objectives are set by investors, and management's just working backwards to make sure they're pleasing investors.


I'm trying to be thoughtful about this but maybe it's a fools errand. Any VC's y'all know of that have a reputation of setting reasonable goals for the companies they invest in?


🧢 Sales Management
🏋️‍♀️ Leadership
1

10 comments

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RealPatrickBateman
Politicker
7
🔪Amateur Butcher🔪
No lol. 
poweredbycaffeine
WR Lieutenant
4
☕️
An important distinction to make about how the VC will treat you is this: was it an equity or debt round?

Equity is a long-term play. The VC is bought into the vision and is partnering with the portfolio company to help them realize success.

Debt rounds are jus that: debt. The VC wants success quickly so that they can be paid back at the multiple they desire.

This is the first criterion to consider.
Charito
Fire Starter
0
Senior Account Exec
Helpful distinction. I'll look into that when evaluating VC backed companies. 
poweredbycaffeine
WR Lieutenant
1
☕️
What is the purpose of your post? Are you looking to vet prospects for your services?
Charito
Fire Starter
0
Senior Account Exec
I'm trying to evaluate sales opps/companies through the lens of the VC's that fund them. I think I've mostly found the answer. 

TheIncarceration
Politicker
0
SDR Manager
I'm still early in my career and this is the first time I'm hearing about debt rounds. Are companies usually forthcoming about that? 
poweredbycaffeine
WR Lieutenant
1
☕️
The press release may tip you off—but if you’re curious, just ask your CEO if it was an equity or debt round. A bridge round is a big red flag to me, which is another type of round of funding.
TheIncarceration
Politicker
1
SDR Manager
Ahh I see. This is super helpful thank you! 
DungeonsNDemos
Big Shot
1
Rolling 20's all day
It would be really hard to get aggregate feedback on "which VCs set reasonable goals". Defining "reasonable" is tough enough, but then applying it across companies that are all different and VCs that all go about managing their investments in different ways.....

this would be a full time job with a team of independent experts. Sahil is a VC and has lots of VC friends. Lol maybe time to start a consulting company to find out?
poweredbycaffeine
WR Lieutenant
2
☕️
What would be the point of the research? Help VPs pick the company that will castrate them the least?

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