From where do the top venture capital firms like Accel, SoftBank or Tiger Global get so much money to invest?'


It’s actually in some ways easier to raise a big fund, up to a certain point, than a small fund.

Most “Limited Partners”, the folks that give VCs the money to invest … are very large.

They manage billions of capital themselves, tens of billions, hundreds of billions in some cases.

They don’t want, for the most part, to invest in tiny little $20m, $50m, $100m VC funds because the amount they invest relative to their own assets under manage is immaterial.

It’s much easier for them to write one $50m check, or even larger, into a large, name brand fund … than 50 $1m or 10 $5m checks into small venture funds.

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Published on March 28, 2017
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