Navigating Fund Size Aspirations: Lean vs. Scaled Strategies

This chapter delves into the varying strategies of funding teams concerning fund size, highlighting why some aim for substantial growth while others opt for a leaner approach. The discussion emphasizes the motivations driving these decisions from both market and capacity perspectives.

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The entire Screendoor team joins David on El Pack to answer your questions on how to build a venture capital fund. We bring on three GPs at VC funds to ask three different questions.

Kyber Knight Capital's Linus Liang asked about why LPs choose to bet on new managers as opposed to investing in more established funds.

NOMO Ventures' Kate Rohacz asked about what parts of venture do LPs think is most opaque.

Articulate's Helen Min asked if every emerging manager should scale into a larger firm.

The Screendoor team is a powerhouse of experienced LPs, bringing together institutional investment experience that spans over a decade. Lisa Cawley, Layne Johnson, and Jamie Rhode have each built institutional venture programs within innovative family offices, financial institutions, and pensions. They have invested in venture capital across stages, sectors, and geographies, and in particular are known as a go-to for emerging managers.

Lisa Cawley is the Managing Director of Screendoor. Previously, Lisa worked with a private multi-billion-dollar global investment firm and Ernst & Young.

You can find Lisa on her socials here:LinkedIn: https://www.linkedin.com/in/31mml/

Layne Johnson is a Partner at Screendoor. Previously, she led the Venture & Growth Equity manager selection effort at the Teacher Retirement System of Texas ("TRS"). She had previously been at Goldman Sachs.

You can find Layne on her socials here:LinkedIn: https://www.linkedin.com/in/layne-johnson-4b71b571/

Jamie Rhode is a Partner at Screendoor. She previously spent 8 years at Verdis Investment Management, an institutional single family office that manages capital for generations 7 through 10.

You can find Jamie on her socials here:Twitter: https://twitter.com/DurationFXLinkedIn: https://www.linkedin.com/in/jerrcfa/

And huge thank you for Linus, Kate, and Helen for jumping on the show.

OUTLINE:

[00:00] Intro

[05:58] Enter Linus and Kyber Knight Capital

[10:06] Why take the risk of betting on an emerging manager?

[18:40] The types of pushback Linus got when he was fundraising

[19:47] The incentives of an LP when investing in VC

[21:49] How do GPs ask LPs how they're compensated?

[24:47] Enter Kate and NOMO Ventures

[28:31] What part of venture is most opaque?

[38:18] The things venture LPs look at beyond the metrics