General VC Questions

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Your fund size should be the minimum target. So in this case $10mm is the minimum target and you can oversubscribe it to a hard cap of say $15 or $20m. The first thing that you should do is to see the conversation through with the LP and...

 -  Mike Suprovici
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General VC Questions

Do the Financial Statement reports produced for a fund in Decile Hub include a Cash flow Statement?

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Community Member
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Dec 06, 2023

Decile Hub produces a set of financial statements for a fund. These seem to include a balance sheet, an income statement, a statement of changes in equity and notes of the investment schedule. There doesn't though appear to be a cash flow statement.

Top answer:

The financial statement reports do not include a Cash Flow Statement. With that being said, a Cash Flow Statement can be produced within Hub and exported if needed.

 -  Rob Del Prete
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General VC Questions

Do cost and fair market value ever differ?

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Edited by:
Haw Kuo
on December 6, 2023
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Dec 05, 2023

Question edited slightly for clarity. 

Top answer:

Yes - cost and fair market value can differ. Cost in this context refers to the amount initially paid for an investment, while fair market value (commonly referred to as FMV) is the current market value of that investment. Changes in mar...

 -  Haw Kuo
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General VC Questions

What is an acceptable equity ask by investors from portfolio companies?

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Edited by:
Haw Kuo
on December 5, 2023
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Dec 05, 2023

Top answer:

What an investor can ask in terms of a percentage of equity or an investment amount depends nearly entirely on variables, so it is impossible to generalize. Some factors to consider for startup: • Geography (US, LatAm, etc.) • Market (B...

 -  Haw Kuo
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General VC Questions

What are the differences between using SAFE in the UK and the US?

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Dec 03, 2023

I believe they are often called ASAs (Advance Subscription Agreements) in the UK. Are there any fundamental differences in how they work in the UK and US?

Top answer:

Generally speaking, an Advanced Subscription Agreement (commonly known as an ASA and designed for use in the United Kingdom), is conceptually similar to a SAFE (originally designed for use within the United States).  However, there are ...

 -  Haw Kuo
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General VC Questions

GP carry raise: How can one perform valuation of a percentage of GP carry prior to fund closure or returns from fund (when DCF can be applied)?

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Dec 01, 2023

An LP has already signed my LPA and is bringing others into my fund as investors. He shared that a condition of bringing others is that I be full-time over the fund since this is the only way one can really run a successful venture. I agree, howev...

Top answer:

Do not form your fund and send LPAs to limited partners prior to you having at least $1m in PACTs signed or 10% of the fund, whichever is greater. This is a major mistake with dire consequences.  Also, please note that the arrangement th...

 -  Mike Suprovici
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General VC Questions

How GAAP and ASC820 are involved in valuation policy?

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Nov 28, 2023

Here is the response of the decile LLM: The Generally Accepted Accounting Principles (GAAP) and ASC 820 (formerly FAS 157) are involved in valuation policy by providing a framework for measuring and reporting the fair value of assets and liabiliti...

Top answer:

The Generally Accepted Accounting Principles (GAAP) and ASC 820 (formerly FAS 157) are involved in valuation policy by providing a framework for measuring and reporting the fair value of assets and liabilities. Under ASC 820, investments...

 -  Rob Del Prete
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General VC Questions

What are the approximate number of Global Venture Firms forecasted by the end of 2023?

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Nov 28, 2023

By my estimates, this number can range from 30,000- 45,000.  There are a multitude of variables to consider.

Top answer:

There is no hard data on this because most of the filings are done at a fund level, instead of at the Firm level. A firm will often manage a family of funds. VC Lab estimates that ~9,500 new VC firms will launch within 5 years.

 -  Mike Suprovici
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General VC Questions

What is an investor discount in a SAFE?

Asked by:
Community Member
Edited by:
Adeo Ressi
on November 27, 2023
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Nov 26, 2023

Top answer:

Convertible notes sometimes include a conversion discount, which enables the investor to convert their debt into equity at a lower valuation then new investors in the subsequent financing round. SAFE notes also sometimes include a discou...

 -  Mike Suprovici
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General VC Questions

Where to find trends in the industry?

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Nov 21, 2023

What are the resources that everyone here uses for staying on top of trends. There are oodles of media out there, which would be most trustworthy for keeping a finger on the pulse? Currently looking at Pitchbook, Carta newsletter, ExecSum Newslett...

Top answer:

Pitchbook does not have accurate data for early stage funds or startups. Avoid them. Neither do some of the other sources you mentioned. To get more accurate information on trends, specialize in areas of focus and find industry publicati...

 -  Mike Suprovici
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General VC Questions

Same LP / Venture Partner compensation

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Sep 28, 2023

Is it allowed for an LP to be a Venture Partner at the same time (i.e. a mentor) and be compensated ?

Top answer:

It is generally not recommended for an LP to also be a Venture Partner - it could introduce conflicts of interest but the LP may also lose their "limited" status and corresponding protection from liability in the case an LP is involved i...

 -  Haw Kuo
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Top answer:

Hi John, in that situation you can manually move them to the appropriate stage in the closing pipeline. This can be done by checking the box next to the LP's name and changing their stage or by simply clicking on the dropdown menu button...

 -  Robert Nipshagen
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General VC Questions

How to send an SHA through Decile Hub

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Sep 24, 2023

After the LP signs a PACT and confirms their commitment we send them an SHA on docusign. I was wondering if there is any way to cut out docusign completely and send the SHA through Decile Hub. 

Top answer:

Decile Hub manages the signature process for members of Decile Launch and Decile Partners.  Venture capital funds do not use a SHA. Limited partners sign a Limited Partner Agreement, or LPA. They normally also sign a Subscription Agreem...

 -  Adeo Ressi
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Top answer:

In my view, it's your job as VC to help your company. If you have expertise in this area, just help them without charging them. It's part of your value add.  It is a bit of a conflict if you charge them and it may require some sort of d...

 -  Mike Suprovici
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