Venture Capital Investment Thesis Reading

The VC world is murky. The innards rarely see light. I just had an advisory call with some chaps setting up a fund and they asked about fund structuring (not the first time).

When I mentioned “This is not something you can Google“, they laughed and said “yeah, we know!”

Every time I have a beer with a VC friend and chat about their fund structure the pattern is pretty much “It depends on where your LPs are, it’s complicated, talk to a lawyer.”

The startup funding process used to be opaque, but in the early 2000s bloggers such as Venture Hacks, Fred Wilson and the like started explaining everything including term sheets.

The VC/LP world has not taken to sharing with the other kids in the sandbox. Indeed, there are very few blogs from LPs. Chris Douvos’s is the only one I have found as of yet. He is very eloquent and I highly recommend reading it.

In an attempt to better understand VCs, I set out to read their investment thesis’ in 2015. One would think this would be the most basic thing.

VCs expect every founder to reach out to them to understand what they invest in, so surely they would do the service of spelling it out. Providing a veneer of academic rigour can easily be illustrated by displaying their investment thesis. Only, you would be wrong.

Having scoured the internet I have only been able to accumulate a handful. If I had this problem, I felt others no doubt would too.

Read on.

Reading on investment memos

Ping me or share in the comments if you have something to add please to help everyone.

• Investment Memos for VC Interviews
• Thesis-driven early-stage Investing
• 16 mobile theses by Benedict Evans at a16z
• Stay In Your Overlaps
• Venture Capital Disintermediation is Coming
• HaaS – An Investment Thesis for Hardware Startups
• Investment Thesis Fundamentals by Dave McClure
• A VC explains VC’s “Investment Thesis” video from Scale Venture Partners
• Technology Waves and the Hypernet
• Notes On Early Stage Technology Investing; Art, Science, or Both?
• Building A Venture Capital Firm Is A Marathon, Not A Sprint by Sapphire Ventures
• Venture Funds as Products. What We Changed for Homebrew III. There are a bunch of interesting insights in this
• In Search of Narrative Violations by Bedrock Capital. The best time to invest in a company is when it’s most in violation of a popular narrative.
• A list of 17 one page thesis’ Turner’s Fantasy VC Portfolio II “I picked 17 companies accompanied with a one-page thesis for each“. On startups, but related
• The Merits of Bottoms Up Investing – Very thoughtful blog on the different ways investors look at opportunities by Brett Bivens

 

If you have something to add to this list, kindly email me and I’ll add it. Cheers.

VC investment memos

Venture capital investors typically write an investment memo before they invest in a company. They will use this to get agreement from other partners (as applicable) and to share with their limited partners (LPs).

There aren’t many that are made public, but I’ve collected all the ones I can find here:

INVESTMENT MEMO COLLECTION