1
VC is not a vibe. Running a venture capital firm is first and foremost a professional investment management activity requiring portfolio management expertise.
2
Investment Theses matter. Any portfolio without actively-managed exposure to our Theses has unaccounted-for risk and is missing vital opportunities to capture returns. Both are major errors.
3
The Power Law is is an observation, not a strategy. Having 98% of fund performance come from 2% of investments is a bug, not a feature.
4
Small funds rule! Big funds (>$500M) deliver cachet. Small funds (<$200M) deliver performance.
5
Distributions matter most (DPI always beats TVPI). Valuation markups are great, but the ultimate objective is distributed capital.
6
Generalists beat specialists. Generalist GPs are the best investors, and generalist funds perform as well or better with lower risk.
7
The best GPs demonstrate four traits: judgement (wisdom), intellect (understanding), emotional intelligence (empathy), and character (integrity).
8
A focus on GP "pedigree" limits outcomes and returns. "Running in the right circles" makes those circles ever smaller, more myopic, and less valuable.
9
"Past performance ≠ future returns". Prior angel investments and headline exits from prior portfolios are nearly meaningless when evaluating a new fund.
10
Unique perspectives produce investor returns. Success in VC is fundamentally about identifying markets and opportunities that others cannot see.
11
Exceptional teams have diverse make-ups. A person cannot see their own blindspots, so investment teams must comprise professionals of broadly diverse insight, perspective, culture, and community.
12
Mission = Vision. The best, most profitable companies are run by resilient founders who are deeply driven by the missions they intend to realize and will run through walls to achieve success.
13
For founders, generating financial results and pursuing core mission are inextricably intertwined. There are no tradeoffs.
14
For investors, generating investment returns and changing ineffective, inefficient, and exclusionary systems are inextricably intertwined. There are no shortcuts.
15
We invest on merit and in outcomes. No matter the structure or terms, all investments are expected to generate outcomes that drive the success and growth of the business.