Finding the right VCs for your startup: Focus on believers, not thesis-fits

The default dream for a first-time investor? Spotting a generational opportunity. 🚀 But the truth is that the first cheque doesn’t buy equity. 👇 It buys you a seat at the table to learn the game. And what it teaches you is 𝘢𝘸𝘢𝘳𝘦𝘯𝘦𝘴𝘴. Awareness that early-stage investing isn’t roulette. It’s a long, sometimes painful game of 𝘱𝘢𝘵𝘵𝘦𝘳𝘯 𝘳𝘦𝘤𝘰𝘨𝘯𝘪𝘵𝘪𝘰𝘯. You start noticing: 🔹 Which founders actually execute. 🔹 Which markets reward discipline over hype and massive spending. 🔹 Which deals you should’ve walked away from sooner. Most new angels underestimate one thing: 𝐒𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞. The best founders already know how to report metrics clearly, engage their cap table transparently, and build in public. The rest learn it the hard way. That’s why ecosystems that blend education + exposure + structure will shape the next wave of smart capital. In West Sweden, that’s exactly the bridge Connect Sverige Region Väst builds where new investors learn fast, and strong founders meet aligned capital. Because angel investing isn’t about writing cheques. It’s about writing smarter ones. ✍️ #AngelInvesting #Investors #Startups #ConnectVäst

What role does luck play in VCs picking winners? I believe you can engineer your own luck by playing a game of large numbers. In the concentration vs diversification debate, I fall into the latter camp. Our job as VCs is to increase the probability of success through rigorous portfolio construction. At Kyber Knight Capital, we expect to invest in around 45 companies with our current $120 million fund (30 of which are core investments). We spread the capital around to hedge against failure. At the seed stage, most companies don't make it (despite the best intentions), so allocating capital widely is the best way to secure the returns our investors expect. For an individual investment, the outcome is highly uncertain, but when you build a large enough portfolio, the math shifts. Higher volumes transform the process from luck into mathematical probability. You dramatically increase the surface area for finding those rare, high-return companies. It's not about being lucky once; it's about putting yourself in a position to be right many times. #VC #VentureCapital #Startups

💸 Fewer checks, bigger bets: early rounds now dominated by single investors Peter Walker, Head of Insights at Carta, shared data showing a sharp shift in early-stage funding, lead investors are now taking nearly 100% of Seed and Series A rounds. The rest, a symbolic 1%, goes to angels. 🔸 The logic is simple: lead investors secure better terms today and tighter control tomorrow, while founders get a cleaner cap table and faster closes. 🔸 For follow-on rounds, a fully led seed signals conviction “if Fund X took the whole thing, they must’ve seen something.” 🔸 Angels and syndicates are getting edged out, but founders benefit from speed, clarity, and fewer competing opinions. 🔸 The trade-off: less investor diversity means fewer networks and viewpoints early on. So what’s better—many small believers or one big backer? #investors #investment #startups #entrepreneurs #startupinvestment

🕚Here’s a throwback spotlight of an exciting and audacious VC fund 💸 Washington, D.C.based Zeal Capital Partners recently closed Zeal Fund II at $82 million. LPs include Citi Impact Fund, M&T Bank, MassMutual, Wells Fargo, Zaffre Investments, and Spelman College, alongside GPs from NEA and Emergence. 💡 Investing initial cheques of between $1M and $2.3M into ~25 early-stage start-ups over four years, with a focus on #fintech, #healthcare, and the #futureofwork and #futureoflearning 🌍 #UnitedStates 📈 Founded in 2020, the VCs latest investments include Seven Starling, Daemo AI, Humanly (humanly.io), Debbie, Certiverse, among others 💭 “The systems-level challenges that have long felt insurmountable — including access to education, economic mobility, financial health, and healthcare — are now among the largest and most urgent market opportunities.” – Nasir Qadree, Founder & Managing Partner 🗞️ Business Wire https://lnkd.in/eDk-RXCf 👏 For the #AudaciousInvestors unleashing innovation and reimagining tomorrow🚀 Nasir I Stefanie I Emily I Richard I Bianca I Leo I Susannah I Rodney I Tom I Team Zeal Capital … #venturecapital #vc #funds #startups #entrepreneurs #funding #tech #usa #entrepreneurship #technology #innovation #Washington #venture #fund

Apologies, I disagree. At its core, the founder / VC tension isn’t just about control or liquidity it’s about truth in capital. A surprising reality today is that many funds don’t have the capital they say they can deploy. They have “committed” capital, not cash-in-hand. LPs pledge money over time, and GPs call it down opportunistically. Capital isn’t the scarce resource anymore. Authentic, deployable capital and aligned time horizons are. This will define the next era of venture funding.

Here’s why founders and VCs can’t work together anymore (unless something changes) Founders want control. VCs want liquidity. Founders dream in decades. Funds live in ten-year cycles. At first, those timelines overlap - both sides talk about vision, patience, and building something that lasts. But as the years go by, the incentives diverge. The founder wants to reinvest profits, expand slowly, protect culture. The GP wants DPI (cash back to LPs so they can raise the next fund.) And every month without liquidity quietly turns alignment into friction. The system itself creates this tension. A 7 to 10-year fund structure was designed for a world where IPOs came fast and cheap. That world doesn’t exist anymore. Companies stay private for 12, sometimes 15 years. So what happens? Founders are forced to play short-term games to satisfy long-term dreams. Investors push for liquidity while claiming to be “patient capital.” And both end up trapped - rich on paper, poor in trust. The smartest investors I talked to are playing with different rules: They’re designing what I call “liquidity bridges” —> continuation funds, structured secondaries, aligned buybacks - to let founders keep building without forcing exits. They know the future of venture won’t be defined by who raises the biggest fund… but by who manages time the best. Because in this market, capital is abundant. But time alignment is rare - and that’s where the next great returns will come from.

Whoever wrote this Secret VC article: I adore you. There are some absolutely excellent points that every Founder, Angel Investor, and VC in the Midwest would do well to read! Some key items: 💡 Pre-seed can absolutely be pre-revenue <-- Love to hear it! 💡 There are some VERY good takes on the angel investing environment in the Midwest. "Good angels literally write their checks on a vibe" 💡 The "closet bankers" line is fantastic. Although while I agree that VCs aren't, there are certainly plenty of reasons why founders may feel that way.... 💡 Multi-year projections in a Seed pitch deck don't make sense. <-- 1000% agree here. It's all a guessing game early on and makes no sense to me. I've taken flak for that before but it's freaking true. 💡 Founders should diligence their investors as well <-- YES PLEASE! Love when I hear about this and it's absolutely a signal that the founder knows what they're doing. 💡 It's not "us vs them". It's "us vs entropy" 💡 There's also the reality that Midwest founders may also need to raise from out-of-state investors (and how that's not a bad thing). Personally, I'm very much looking forward to the continued shift here with more angel investors writing more checks, more early-stage capital, and more large checks at later stages. Lots of room to grow... Philippe V. and the team at StartMidwest have absolutely hit it out of the park with this series. Extremely informative and what a *great* way to get a lens into how the VC world operates here in the Midwest, and how to navigate it the right way. Take 5 minutes to read this today and share your thoughts: https://lnkd.in/ed8FwbeK

Roelof Botha just called venture “return-free risk.” He’s not being dramatic. He’s doing math. $150B flows into VC annually. Billion-dollar exits that actually return capital? We get maybe twenty. MAYBE. The equation is broken. And Roelef is right to sound the alarm bells. At current fund sizes, the system would need dozens of huge wins every year to make LP portfolios pencil out. Let’s be honest….thats just not gonna happen, not at a level necessary for the returns promised. That means the asset class itself is under strain: → LPs chase exposure that can’t produce enough exits → GPs manage ballooning funds built on momentum, not multiples → Founders absorb the cost — longer timelines, harsher dilution, and a market where “caution” is really fear of negative DPI When the exit window narrows, VC stops being venture. It starts behaving like structured credit in hoodies. Three signals to track: For founders: - Fund cycles are compressing. Hold periods are stretching. - Most Series B rounds are bridges disguised as growth. - Back investors who can manufacture exits — not just chase them. For LPs: - Back managers who can create liquidity, not just mark up valuations. - Dry powder isn’t leverage when the pipeline is clogged. For everyone deploying? The math will correct. It always does. What are you seeing in your portfolio or pipeline? Are exits manufacturing themselves — or being manufactured? #VentureCapital #LPs #Founders #CapitalMarkets #PrivateEquity #VCMath #Liquidity #StartupFunding #DPI #VentureReturns

3 red flags that are killing your fundraise according to a $100M VC fund. Warning signs that Juan Carlos Pacheco and IDEA Fund Partners screen for in the first conversation: • Arrogance (kills partnership) • Weak command of numbers (signals chaos) • Saying "no competition" (shows market naivety) Here’s how to avoid them to start showing up as a credible, coachable operator that investors actually want to partner with. #1 Arrogance Juan Carlos said it plainly: "If you're a jerk, that's a very quick red flag. Because it's a partnership when you invest." This isn't about being nice for the sake of being nice. It's about what arrogance signals. If you dismiss questions, you'll dismiss your customers If you can't take feedback in a pitch, you won't take it from your board. .  If you think you know everything, you won't adapt when the market shifts. Investors are buying into years of partnership. Board meetings. Hard conversations. Pivots. Bad quarters. If you're arrogant now, you'll be impossible later. #2 Weak command of your numbers Juan Carlos said: "If you can't speak with some intelligence about revenue, burn rate, how you're gonna use the capital... that's a huge red flag." Weak grasp of numbers signal operational chaos. Vague on how you'll use capital? ↳ You'll waste it. Don't know your burn rate? ↳ You're guessing at runway. Can't explain how you arrived at your valuation? ↳ You don't understand your business model. Investors aren't expecting perfect projections. They know things will change. But they need to know you're running your business with discipline. That you're making data-driven decisions. That you can be trusted with their capital. If you're fuzzy on the numbers now, you'll be reckless with their money later. #3 "We have no competition" This one kills more deals than founders realize. Juan Carlos said: "Competition is typically a good thing. It shows there's a market there." Here's what "no competition" actually tells an investor: Either you haven't done your homework, or there's no market and customers don't care enough to pay. And if there *is* competition and you just don't see it? You're naive. You're not paying attention. You don't understand your landscape. Juan Carlos used a sports analogy: "If you're going into a tournament, you scout your opponents. You see what they're strong at. You see what you're strong at. And you adapt." Competitors aren't threats. They're validation. They prove there's a market. They show you what works and what doesn't. They force you to get sharper. If you can't articulate your competition and your edge, you're not ready. At the early-stage, there is uncertainty and risk.  Investors don’t expect flawlessness. They do expect coachability, self-awareness, and market intelligence. Know your numbers cold, stay humble, and study your competition. Do that, and you’re already ahead of most pitches.

In venture capital, not every deal is about new money going into the company. Sometimes, it’s about existing shareholders like founders, early employees, advisors, or angel investors selling a portion of their shares to new or existing investors. These are called secondary transactions and below are 5 reasons why they matter.   1. Founder Liquidity: Early-stage founders often go years without a salary or with limited personal cash flow. In later rounds, Founders may sell a small % of their equity (say, 5–10%) so they can de-risk personally, pay off debts, buy a home, or just reduce stress. This helps founders stay focused on scaling the company.   2. Cap Table Cleanup: Secondaries can also be used to buy out early angels or small investors who no longer want to hold their stake. This simplifies the cap table and consolidates ownership under later-stage, more strategic investors.   3. Investor Signaling: Allowing secondaries is a subtle show of confidence. It signals that later investors believe in the long-term upside enough to buy shares directly from insiders. But, if too much secondaries are sold, it may raise concerns about a founder’s commitment.   4. Quiet but Strategic: These deals are often kept low-key. Too much attention on founders “taking money off the table” can create a perception issue, so VCs and founders usually position it as a healthy step in a long growth journey.   5. Timing Matters: Most VCs are comfortable with small founder secondaries around Series B or C, once product-market fit is clear. At Seed or Series A, it’s less common since investors want founders highly incentivized. If the opportunity for a secondary comes up, think of it as rebalancing your personal risk, not “cashing out.” Selling 5% of your stake might buy you peace of mind, while still leaving you deeply invested in the upside.   Still have questions? Ask us here:  https://lnkd.in/gsvQySnq   #HarmoniousFundAdmin #VentureCapital #VCFunds