Origins - Inside Venture Capital, Hosted by a GP and an LP Franchise Funds: Is Being a VC Franchise the Ultimate Goal with Thomas Kristensen
Mar 11, 2025
Thomas Kristensen, a seasoned partner at LGT Capital Partners, shares his insights on the venture capital landscape with Bezer Clarkson. They challenge the notion of 'franchise funds' and discuss how GPs must continuously innovate instead of resting on past successes. The duo dives into what genuinely constitutes a successful fund and the importance of recognizing performance metrics. Additionally, they speculate on the evolving expectations for IPOs and the reasons why many founders shy away from becoming public company CEOs.
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Franchise Funds as Stale Entities
- Thomas Kristensen associates the term "franchise fund" with something established but potentially stale and resting on its laurels.
- He cautions that being at the top of venture is not an excuse to stop innovating or improving.
Dig Deep Into Fund Dynamics
- Take time to build relationships and understand the team dynamics of venture funds.
- Prioritize transparency and engagement to truly assess a fund beyond surface-level metrics.
Stable Performance Defines Franchise Funds
- Great venture funds consistently generate a stable base return over multiple funds, with occasional standout successes.
- True franchise firms deliver rolling three-fund returns around 3.5x to 4x TVPI, not just isolated big hits.