Q: What services does venture capital provide beyond funding?
As an investor your role is fairly minor in end, other than capital & mentorship
With 1 big exception
Most raw first-time founders do not have network of great VPs to draw on, let alone meet with
Give them 1-2 great hires
That does move the needle in the $0.1m-$10m ARR phase
— Jason ✨BeKind✨ Lemkin ⚫️ (@jasonlk) January 23, 2021
Often, not that much.
But the top VCs at least:
- Find you at least 1 great VP. This is pretty valuable, although you don’t need a VC to do this.
- Find your VCs for the next round. This is pretty valuable too, especially in the early days. Later, you may not need much help.
- Bridge you if you are doing OK but need a little more money. Most funds can give you a little more money if you do OK but need a little bit more. This can be insanely valuable.
- PR and promotion. Valuable if the firm has a top brand. Although again, you don’t need VC to get this.
- Mentorship and partnership. You’re together for a decade. This is often not nearly as valuable as many VCs claim. But if you really get a great partner, it can really help you scale. Avoid mistakes. And have a partner for years and years.
You’re in it together.
Published on January 25, 2021