Peeking through the VC keyhole

What you always wanted to know but never dared to ask an investor. Although successful tech startups might make headlines, their venture investors often remain in the background, shrouded in mystery. This month, HBR published what is perhaps the most comprehensive survey of VC firms to date and shared some very interesting findings. According to the survey, about 50% of new deals come from leads from former VC colleagues, acquaintances or other investor firms. For each investment they make, investors on average consider 101 other opportunities. Entrepreneurs who are not connected to or plugged into these venture networks might have a hard time to get funding. Investors live and die for their founders; winners always seem to be founders who can build a kick-ass team. VCs spend about 30% of their time closely working with their portfolio companies, providing them with strategic and operational guidance, connecting them to other investors and customers and helping them to hire board members and employees. What surprised me most was reading that many early- and mid-stage investors do not make an in-depth company valuation and technological feasibility assessment before making an investment. When I discussed this with VC partners in my network, they assured me that this was certainly different in our AgTech industry, as technology adoption in Ag can be slow, risky and challenging. It would be like buying a car without looking under the hood, one investment manager assured me. Happy to be working in the right startup field, I concluded. But when I shared this experience with a friend/statistician, he provided yet another point of view. Sample size was too small to conclude anything and VCs that work with me are probably all adepts in the art of technical due diligence. Anyway, still a nice read https://hbr.org/2021/03/how-venture-capitalists-make-decisions?autocomplete=true