Blog Archives

Why a fundraising winter is coming for Micro-VC’s

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of early stage venture and start-ups. Recently, I received an email from a seed fund manager inquiring about current Limited Partner appetite for investing in new seed fund managers. The query was in response to a declaration made by someone closely connected to LP’s that the current fundraising environment for venture is worse than what we saw following the...

Read More

Deconstructing the seed round implosion

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of early stage venture and start-ups. The recent TechCrunch article illustrated a stark downward movement in the total number of venture deals completed over the past few years, something that those intimately close to the venture market have experienced first-hand. The data supporting this shift may surprise some when seeing that annual deployed capital has...

Read More

Why Fortune favors the bold in Venture

Why Fortune favors the bold in Venture

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of early stage venture and start-ups. With the number of seed funds rising daily, I often get asked the following two questions: 1) Is there too much institutional seed capital? 2) Are there too many seed funds? While often conflated, these are two very different questions. Is there too much seed capital in venture? No, I don’t think there is too much...

Read More

“Raising a venture fund versus starting a venture franchise?”

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of venture and start-ups. It’s an immutable fact that delivering strong returns are necessary in building an enduring venture franchise. In my last post, I discussed the three important components of investing (sourcing, picking, and winning) and how managers should assess their differentiation around those items. Most new venture managers consider these elements...

Read More

Things to think about before launching a venture fund

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of venture and start-ups Along with the reasons I’ve previously discussed, this list and chart below clearly suggest that becoming a venture investor (or more specifically a seed stage VC) is easier than it’s ever been. Yes, fundraising is hard, but with patience and pragmatism, the barriers of entry are low for new entrants. 500+ seed funds! While entering VC is...

Read More

What you need to know before raising a Micro-VC fund today

What you need to know before raising a Micro-VC fund today

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of venture and start-ups. Although I’ve never raised a venture fund myself, I can claim having worked closely with managers on nearly 200 fund raises over the past 5+ years. These raises, coinciding with the incredible growth of new venture firms over the past 6 years, primarily relate to those in the Micro-VC sector (firms focused primarily on seed stage...

Read More

Is there ideal portfolio construction for seed funds?

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of venture and start-ups.. In my last post, I illustrated the exit math necessary for a seed fund to generate a 3X net return multiple for its investors (LP’s). The portfolio construction of the fund used in the example is one that is most often seen for seed funds: ~30 portfolio companies, with about half of the fund reserved for doubling down on portfolio...

Read More

Micro-VC; Smaller is better, BUT the math is still really hard

Micro-VC; Smaller is better, BUT the math is still really hard

Follow me @samirkaji for my random, sometimes relevant thoughts on the world of venture and start-ups. In 2012, the Kauffman Foundation released a report titled “We have met the enemy and he is us”. The report highlighted the lack of performance within venture capital and placed culpability on the investors (LP’s) of venture capital funds. One of the key findings in the study was compelling data that venture funds <$250MM performed...

Read More

Are LP’s still bullish on Micro-VC?

Around this time last year, we co-produced the inaugural RAISE summit, an event conceived by Akkadian Ventures and Core Ventures Group, and primarily developed to help foster venture fund entrepreneurship. With over 100 venture capital fund managers and 50 venture focused Limited Partners (LP’s) in attendance, the follow things became clear during the conference: An extraordinary amount of managers were raising first time funds, with an...

Read More

Nano-VC funds are all the rage

Follow me @samirkaji for my always random, sometimes relevant thoughts on the world of venture investing and startups. Over the years, I’ve spent a lot of time studying and chronicling the Micro-VC (or seed funds for those who prefer) In my post from last October titled “The Micro-VC surge won’t stop” I discussed the continued development of the Micro-VC space, and briefly mentioned the growth we’ve observed of what we deem as...

Read More

So you want to start a VC firm?

Earlier this year, a few venture Limited Partners and I were comparing notes around the dramatic spike in seed VC (or Micro-VC as they often are referred to) firms we observed in 2014 and 2015. Below is a table illustrating the growth of the sub-sector. . The general consensus within the group was that the Micro-VC market was saturated and an expectation that we would start seeing definitive signs of consolidation of active Micro-VC firms...

Read More

Why the Micro-VC surge will drive innovation across the US

The following was co-authored by Ezra Galston of Chicago Ventures (@ezramogee) and Samir Kaji (@samirkaji) of First Republic Bank. Please follow me samir kaji on Twitter and Medium for my thoughts on the world of venture capital. Over the last several years much has been made of the opportunity, or perceived lack thereof in technology centers outside of the Bay Area and NYC. From Steve Case’s Rise of The Rest Tour, to Google for...

Read More

#LongLA – LA Venture is underrated

#LongLA – LA Venture is underrated

Follow me @samirkaji for my always random, sometimes relevant thoughts on the world of venture investing and startup (the below is a repost from an article I posted on CB Insights) When ranking US startup hubs, it’s widely accepted that New York City stands out clearly as the largest venture ecosystem outside of Silicon Valley. Startup formation and funding data seems to confirm this notion as the area consistently ranks as the...

Read More

The Micro-VC surge just won’t stop

  Follow me @samirkaji for my always random, sometimes relevant thoughts on the world of venture investing and startups. Although I spend most of my days closely tracking the emerging venture capital market, I almost fell of my chair when I came across a report from Prequin that noted that nearly 500 first time Micro-VC funds were currently in the market (the vast majority being US based). Micro-VC slowdown does't appear to be...

Read More

Venture Observations 2016 — Tweetstorm version

Follow me @samirkaji for my always random, sometimes relevant thoughts on the world of venture investing and startups. As we move closer to Labor Day (amazing how quickly this year has gone), I wanted to share a few observations we’ve seen within the world of venture. I may expand on a few later, but in the interest of time and ease of digestion, I’ve listed my thoughts tweetstorm style below— Yes, I may have hit >140 characters on a...

Read More

The different types of Seed VC’s

Please follow me @samir kaji for my random and occasionally relevant thoughts on venture capital and technology. Stemming from the venture pullback that started in late 2015, it’s been one of the toughest years in recent times for companies seeking seed capital from VC’s this year.  The good news for companies seeking seed venture funding is that with the with a record number of new institutional seed funds and what appears to be shaping...

Read More

Venture Capital’s diversity problem is being solved by Micro-VC’s

Venture Capital’s diversity problem is being solved by Micro-VC’s

Follow me @samirkaji for my random, sometimes relevant thoughts about venture capital As expected, when Cyan Banister joined Founders Fund in March of this year, most of the headlines focused on the firm bringing on its first female partner. Although the emphasis probably should have been focused on the firm bringing aboard a tremendous talent who will invariably play a big role in delivering value to the firm, I realize that driving...

Read More