Make Decisions with a VC Mindset

Venture investors are the hidden hand behind the most innovative companies surrounding us. According to research conducted by one of us (Ilya), venture capitalists were causally responsible for the launch of one-fifth of the 300 largest U.S. public companies in existence today. They have played an essential role in unlocking the power of the internet, the mobile revolution, and now artificial intelligence in all its forms. Apple, Google, Moderna, Netflix, Airbnb, OpenAI, Salesforce, Tesla, Uber, and Zoom—these firms disrupted entire industries despite initially having fewer resources and less support and experience than their mature, successful, cash-rich competitors. All these businesses could theoretically have emerged from within an established company—but they didn’t. Instead, they were financed and shaped by VCs. Indeed, we estimate that three-quarters of the largest U.S. companies founded in the past 50 years would not have existed or achieved their current scale without VC support. READ MORE

The Data-Driven Investor Of Today And Tomorrow

The term "data-driven investor" might sound pedestrian—it’s hard to point to an industry that hasn’t become more data-driven over the past two decades. But in recent years, the private capital industry’s adoption of data-driven insights represents a very real and material shift in how firms are now operating.

As a proxy, one can look at the hedge fund industry for a historic example of this strategic shift. Up until the 1980s, hedge funds were mostly run by Wall Street veterans who used their intuition and connections to make investment decisions. But as more data became available, a new breed of funds emerged that combined quantitative models with human judgment to drive better decisions and reduce cognitive biases. Venture capital and private equity are at a similar inflection point right now. READ MORE

Secondaries Had a Big 2023. This Year Could Be Bigger.

Last year was a big one for the secondary market. The party isn’t over yet though: Industry experts predict that 2024 will be another record year for the exit strategy.

Between $110 billion and $115 billion of stakes in private funds changed hands in 2023, depending on who you ask. According to a recent secondaries report from BlackRock, this is the second-highest year of closed transaction volume on record. READ MORE

Private-Equity Backed IPOs Gather Steam in 2024

Momentum has grown behind private-equity backed initial public offerings and, as inflation falls and central banks pivot toward reducing rates, two-thirds of private equity firms predict a rise in IPO-exit activity this year, according to EY's 1Q 2024 IPO trend report.

Five of the around 10 private equity-backed listings in the first three months of the year were among the quarter's top 10 IPOs in terms of proceeds or funds raised and include Germany's Douglas and BrightSpring Health Services in the U.S., the report says. READ MORE

Funding The Future: The Investment Potential Of Today’s Climate Tech

Climate tech encompasses a diverse range of technologies and applications focused on mitigating climate change, either by reducing greenhouse gas emissions across various industries and processes or by removing previously emitted carbon dioxide from the atmosphere. Key sectors for climate tech include mobility & transport, energy generation & distribution, industrial processing & manufacturing, food & agriculture, and the built environment. Many climate technologies offer alternatives to conventional high-carbon processes, such as renewable energy sources and chemical production that do not use fossil fuel resources. Others are designed to complement existing high-carbon processes, for example, by capturing carbon from industrial or energy-producing facilities. READ MORE

What venture capital and bootstrapping have in common

In 2009, my friend Paul and I decided to start a company. We’ve both worked as software developers and project leaders for large companies, and we understood the challenges and opportunities of building great, modular teams that can get things done and fit right in with the corporate culture. Our idea was nearshoring or empowering our friends and neighbors in Latin America (LATAM) to work for some of Silicon Valley’s leading companies without having to leave their homes in Argentina, Mexico, or Brazil. READ MORE

2023 Him For Her And Crunchbase Study Of Gender Diversity On Private Company Boards

Our fifth annual study, which characterizes the boards of the most heavily funded private companies in the U.S., reveals significant improvement in board diversity over the past five years.

It also points to independent board seats as the critical lever for change when it comes to increasing cognitive diversity in the boardroom, expanding networks, and, as suggested by our latest data, even boosting funding. READ MORE

The Rising Popularity of Venture Debt, Structured Equity and Advice for Founders

In the current economic landscape, characterized by higher interest rates, lower valuations, and considerable dry powder sitting on the sidelines, companies are increasingly turning to a mix of structured equity and debt to raise capital. We’ve seen this recently with notable financing rounds such as Shield AI’s $200 million Series F and Forward Health’s $100 million Series E. These cases illustrate a growing preference for leveraging both equity and debt—a strategy that is likely to gain even more traction in the current challenging conditions. READ MORE

How venture capital is changing, and why it matters

Venture capitalists are bankers with better branding.

Friends and I traded that joke back and forth in the 2010s. A fiscally cautious response to the Great Recession contributed to a slow, if steady, economic rebound, spurring central banks around the world to maintain historically low interest rates. This cheap-money era motivated money managers to chance ever-riskier asset classes. 

Big money flooded funds focused on every stage, from a startup’s first check all the way to its IPO. READ MORE

Women cofounders raise about 20% of venture capital—but we often overlook them

Female founders of VC-backed companies raise only 2% of the venture capital invested annually. It’s a worrying statistic that is often repeated year after year by publications, researchers, and the VC industry at large. However, it can be misleading and ignores the progress that has been made over the past 20 years.

This 2% figure ignores the many women who are cofounders, CEOs, COOs, and CFOs. While just 2% of VC capital goes to firms founded solely by women, closer to 20% of VC capital goes to firms with at least one woman as a cofounder.  READ MORE

Secondary Market Seeing Rebound After Slowdown

Payments giant Stripe turned a few heads late last month when it announced it had a secondary deal with investors to buy current and former employees shares through a tender offer that valued the company at $65 billion.

The valuation was a 30% uptick from its previous funding round and seemed to show the robustness of a secondary market that had its own stumbles as venture capital fundraising tumbled last year. READ MORE

Ready for the Biotech Bounce Back in 2024?

Heading into 2024, expectations for biotech venture capital (VC) and private equity (PE) investments were low following two lackluster years, but as we wrap up Q1, those expectations have been turned on their head after a strong start to the year. This leads us to question whether these early tailwinds are here to stay?

Already, several themes have emerged as value drivers in 2024, including artificial intelligence (AI), weight loss, and cell and gene therapy manufacturing. Companies that are still standing in these sectors would be well advised to make strong moves toward their next growth milestone. READ MORE

A Changing of the VC Guard May Create New Opportunities for Entrepreneurs

Given the breakneck pace of technology development and turnover at growing companies, one might imagine the makeup of firms created to fund emerging, potentially blockbuster startups would experience similar turnover. Yet it appears that many of Silicon Valley's financial old guard are only now starting to pass the torch to a new generation of aspiring venture capital entrepreneurs. READ MORE