Posts Tagged ‘metrics’

Raouf: Should You Care About Your VC’s Investors?

Firas Raouf from OpenView Partners has today’s VC Post of the day up titled Should You Care About Your VC’s Investors? In it he covers some fundamentals about how VC funds are structured and then lists three things that the nature of the LPs of a VC firm will tell you about that firm.

  1. VC firm credibility: The quality of a VC can often be judged by the quality of its LPs. High-quality LPs invest in high-quality VCs.
  2. VC firm stability: Is the LP base stable, or is there significant turnover in LPs from fund to fund? Is there LP concentration, which would increase the risk of turnover? Are the LP funds stable enough to continue funding the VC over time?
  3. Exit Pressure: Are the LPs pressuring the VC for exits? What is the hold period that LPs are pushing for and how does it vary from the VCs period? How does either period differ from yours?

We cover a lot of this stuff, and more, in Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist in Chapter 8: How Venture Capital Funds Work but are psyched to see other VCs blogging about this in an effort to demystify how VC firms are actually structured, VCs are compensated, and what impacts their motivations at different points in the life of a fund or a firm.

Today’s runner up post is from Fred Wilson at Union Square Ventures titled 30/10/10 where he explains a pattern to the metrics he sees across his portfolio for both web and mobile apps.

500Startups: Cohort Metrics For Startups

Today’s VC post of the day is from Dan Martell.  Dan isn’t a VC, but is a super-mentor for 500Startups and is the Co-Founder of Flowtown, But more importantly, he’s written two excellent blog posts on Cohort Metrics. Don’t know what a Cohort Metric is? Shame on you – go take a look at the posts right now.

Many VCs and entrepreneurs care about metrics. But they often care about the wrong ones, or don’t understand the ones they are looking at, or think metrics is the way they measure things in Europe. Dan’s posts are a great introduction to understanding how to think about cohort metrics, which makes your metrics a lot more valuable.