#19: Practical VC seed investor explains the institutional funding game – John Francis

John Francis is a general partner at Stout Street Capital, a  venture capital fund based in Denver, Colorado. Stout Street has made 70 small seed and pre-seed investments in software startups outside the big tech centers in North America. 

Unlike big Silicon Valley VCs, almost half of Stout Street's investments are in practical startups that have reasonable valuations, sustainable growth models, and won’t need more outside investment before they exit. 

In this in-depth interview with a “practical funder,” John explains the ROI math of professional venture investors and reveals how they think about investing. John also has great insights on how founders should think about raising money, or not, in the first place. 

In this episode, John explains:

• The basic investment math that a seed-stage venture fund manager needs to deliver the expected return to their “limited partner” investors
• What kind of investment valuation and eventual exit outcomes are required to raise institutional capital
• When a practical founder shouldn’t raise VC funding and how they should be thinking about taking outside investment capital
• How “practical VC investing” is different than traditional moonshot VC investing and why founders need to be clear about which kind of funding they want
• What’s happening in valuation for investment and acquisitions in 2022 compared to 2021

Find all the Practical Founders Podcast episodes at practicalfounders.com.