menu
techminis

A naukri.com initiative

google-web-stories
Home

>

Startup News

>

VC Strateg...
source image

Medium

5d

read

45

img
dot

VC Strategy and Operations-1

  • A VC fund comprises a distinct legal and operational framework, with the management company (franchise) separate from the actual funds (LP entities).
  • VCs face challenges similar to entrepreneurs during fundraising, needing to raise funds from LPs, who are then legally obligated to provide the funds within a set time frame.
  • The compensation structure significantly influences VC behavior, with provisions such as recycling management fees to reinvest returns into meeting initial capital commitments.
  • VC fund agreements establish investment parameters over time, including metrics like Multiple on Invested Capital (MOIC), Gross Internal Rate of Return (IRR), and differentiation between realised and unrealised values.

Read Full Article

like

2 Likes

For uninterrupted reading, download the app