The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
20VC: Are LPs Open For Business? What Does it Take to Raise a Fund Today? How Has What LPs Want to See in Fund Investments Changed? Why Do LP Incentive Mechanisms Need to Change? Which Funds Will be Hit Hardest with Beezer Clarkson @ Sapphire Partners
Oct 18, 2023
Beezer Clarkson, who leads investments at Sapphire Partners and has a rich background with Morgan Stanley and Draper Fisher Jurvetson, dives into the evolving landscape of Limited Partners in venture capital. She discusses how LP expectations are changing, particularly regarding liquidity and commitment strategies. Beezer also critiques the current LP incentive mechanisms, suggesting they need a rethink. Finally, she emphasizes the importance of pinpointing standout companies for fund success, showcasing the necessity of both strategic thinking and transparency in this competitive space.
49:45
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Quick takeaways
- Having a power law defining company in a portfolio can significantly impact overall performance in venture capital.
- LPs are facing liquidity strains in the market, leading to adjustments in portfolio management and challenges in making fund distributions.
Deep dives
Importance of Power Law in Portfolio
Understanding the significance of having a power law defining company in a portfolio was highlighted. It was emphasized that having a company with significant returns can change the understanding of how venture works and drive overall performance. It was also noted that in early-stage funds, having a company that returns at least one time the fund is crucial in achieving outperformance.
