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In this post, we summarize 8 ways we have seen founders take control of the harsh economic environment to keep their companies alive, thriving even. (*TLDR: Find more taps and connect them to your buckets. Find more buckets and fill them with water. Keep plugging the leaks with whatever and whoever you have.)
The venture space is saturated with emerging funds and venture brands— this trend is likely to continue for the foreseeable future. However, as a result, it has become challenging for LPs to differentiate one venture fund from another. Furthermore, it is increasingly challenging for founders to find and partner with smaller, value-add funds, especially if so many other smaller funds sound like they are promising and saying the same thing.
Therefore, without clear differentiation, it will be an uphill battle for first-time emerging fund managers GPs to:
Secure meetings with LPs who can provide the capital for your deployment.
Attract top founders and their companies to invest in and grow.
If you are a first-time emerging fund manager, starting and raising a fund requires a lot of effort— you have your work cut out for you.
Just like a startup founder, emerging fund managers are prone to burn-out and health challenges — working long hours, traveling for extended extended periods, etc.
Therefore, it is just as essential to ensure you are clear about why you want to build a fund and what specifically about it inspires you. Your motivation must be intrinsic.
Capital is a great amplifier. When great ideas meet the right people, the proper application of capital helps startups commercialize incredible products and services. The great news: there is an increasing number of talented, mission-driven emerging managers entering the venture space. These emerging managers possess the following:
The authentic desire to enrich the startup ecosystem by building lasting relationships, and effectively deploying capital to support founders and their teams.
Empathy, which enables them to resonate with founders and their teams.
First-hand operational experience, as a founder or an executive.
Strong recognition of the importance of helping investors (Limited Partners, LPs) realize returns on their investment.
