Daniel Jones

𝐍𝐨𝐭 𝐚𝐥𝐥 𝐕𝐂 𝐟𝐢𝐫𝐦𝐬 𝐚𝐫𝐞 𝐜𝐫𝐞𝐚𝐭𝐞𝐝 𝐞𝐪𝐮𝐚𝐥... 𝐓𝐡𝐞𝐫𝐞 𝐚𝐫𝐞 𝟔 𝐝𝐢𝐟𝐟𝐞𝐫𝐞𝐧𝐭 𝐭𝐲𝐩𝐞𝐬 𝐨𝐟 𝐟𝐢𝐫𝐦𝐬 𝐲𝐨𝐮 𝐬𝐡𝐨𝐮𝐥𝐝 𝐤𝐧𝐨𝐰. When looking to break into VC or move to a new role within VC, it’s incredibly important to understand the nuances of different types of VC firms. The type of firm dictates your role and affects what your day-to-day looks like. It’s also incredibly important for founders to understand the different types of firms as it will affect how, when and why they support you. 𝐓𝐡𝐞𝐫𝐞 𝐚𝐫𝐞 𝟔 𝐦𝐚𝐢𝐧 𝐭𝐲𝐩𝐞𝐬 𝐨𝐟 𝐕𝐂 𝐟𝐢𝐫𝐦𝐬: 1️⃣ Micro VC 2️⃣ Institutional VC 3️⃣ Corporate VC 4️⃣ Government VC 5️⃣ Family Office 6️⃣ Angel Syndicate The quick TLDR is that all these VC firms are very different. 𝐓𝐡𝐞 𝐕𝐂 𝐟𝐢𝐫𝐦𝐬 𝐯𝐚𝐫𝐲 𝐛𝐲 𝐋𝐢𝐦𝐢𝐭𝐞𝐝 𝐏𝐚𝐫𝐭𝐧𝐞𝐫 𝐛𝐚𝐬𝐞, 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐬𝐭𝐚𝐠𝐞, 𝐜𝐡𝐞𝐜𝐤 𝐬𝐢𝐳𝐞𝐬, 𝐨𝐰𝐧𝐞𝐫𝐬𝐡𝐢𝐩 𝐭𝐚𝐫𝐠𝐞𝐭𝐬, 𝐝𝐢𝐥𝐢𝐠𝐞𝐧𝐜𝐞 𝐭𝐢𝐦𝐞𝐥𝐢𝐧𝐞, 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐨𝐛𝐣𝐞𝐜𝐭𝐢𝐯𝐞𝐬, 𝐜𝐨𝐧𝐭𝐫𝐨𝐥 𝐥𝐞𝐯𝐞𝐥𝐬, 𝐫𝐢𝐬𝐤 𝐚𝐩𝐩𝐞𝐭𝐢𝐭𝐞 + 𝐦𝐨𝐫𝐞. For VCs, this is helpful for many reasons. It can help you choose the right role for you. It can help you build out syndicates for your portfolio companies. It can help you with intentional networking. Overall, it will make you a more strategic investor. For founders, this is critical information to know as you think about who will sit on your cap table. Choosing the right partners that fit your business goals and values will be a key part of your success. #venturecapital #startup #founder #recruiting #fundraising

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Exposing harsh truths with data, not opinions. Practical, actionable steps for founders to thrive in their next funding round. The time is good to go fundraising - I'll show why and how. If you're at Bits & Pretzels, come have a chat!

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Don’t stack post-money SAFEs. I know YC backs them & I, as an investor, love them. But for founders, 1 post-money SAFE is fine—2+ can be deadly: What if I told you I’ll lead your seed round but I want: 1- Full ratchet anti-dilution rights. If your next round is say at a 50% lower valuation, my share price gets lowered by 50%. 2- Anti-dilution against future options. If you if you increase the size of your ESOP, 100% of the dilution goes to founders and existing employees. 3- Anti-dilution against future notes. If you raise a pre-or post money SAFE or a convertible note, only the founders and employees get diluted, not me. You’d tell me I’m crazy, right? You’d at least tell me it’s not market, not standard? But it is market, it is standard, and it’s called a post money SAFE. #startups #founders #venturecapital

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Not to be <that guy> again, but can we take a moment to talk about how f*cked up finance "hiring" is in early stage venture? Obviously I talk to ALOT of VC backed startups and naturally this is going to sound a bit self serving, after all EmergeOne provides fractional CFO support to VC backed startups from seed to series B. 1. Hiring a full time CFO too early - unless you have sufficient capital to manage, this is a waste of resource. 2. Hiring a CFO (fractional or full time) too late - there is an inflection point, after you've raised a tonne of capital or have strong revenues where it's critical. 3. Hiring too junior and calling them a CFO - you don't become a CFO through qualifications, you do through experience. Junior finance heads may plug some gaps, but don't expect strategic insight. 4. Doing it yourself - Yes, Xero exists and, yes it's easy to use. It's also easy to use incorrectly and your books of account are only a small part of your finance stack. 5. Only going operational - indexing towards only hiring in someone to fix the operational stack (invoice flows, revenue accounting, spend management etc) doesn't work for long, it's as important - at the right stage - to have the strategic insight a CFO can provide. 6. Hiring in a big 4 or corporate background 'heavy hitter' - most of these folk will not have worked in a cash strapped, resource constrained environment, they are used to having machines behind them and more often than not will flounder. 7. Hiring someone who has never worked with VC backed companies - there are lots of folk out there who are great working with 'trad' businesses, but who don't know the complexities that arise working with an institutionally funded early stage business. 8. Searching for unicorns - I can categorically say that no CFO is going to do your bookkeeping (at least for any length of time), trying to find someone who will 'do it all' is a false economy and you will end up with either your finance ops or your strategic finance suffering. 9. Not bringing in anyone operational at all - strategic finance can only add value when the basic hygiene of your finances is in place. You can't do strategy if the downstream information is broken. 10. Assuming there is only one way to do finance - there is no rinse and repeat playbook for building a finance team, what worked in company x won't necessarily work in company y. What works in a fintech doesn't necessarily translate to what works in a marketplace. So here comes the hard sell (ok not really hard, but I'd kick myself if I didn't do this) - what we see working well once a company has raised enough capital or is printing enough revenue to warrant it is to bring in a fractional CFO (and of course an EmergeOne one would be best 😘) who can help figure out how to structure your strategic and operational finance stack the right way, first time. Give me a shout if you're trying to figure this all out, I'm always happy to give you my tuppence worth.

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I got a bit annoyed with a VC last week They posted all this data and findings about what types of pitch decks got funded. Slide by slide data breaking down what increased or reduced chances. - The traction they had - If the team had previous exits - If the founders went to business school For me, this type of content hurts our ecosystem. It makes founders more confused. It makes us think that if we follow and reverse engineer this data, we get ahead of the rest. But then, it dilutes the ecosystem further as more try to gamify their way through. How about we look at data correlation of people on ICs vs who got funded.

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I've worked with 90+ founder / fund managers. Some want an easy button I've got good news / bad news 𝗕𝗮𝗱 𝗻𝗲𝘄𝘀 𝗳𝗶𝗿𝘀𝘁 If the easy button means any of these things >> $1 billion in AUM? Need it yesterday >> First time meetings that result in closed biz >> Fund mgr doesn't participate in sales and marketing If that's our definition of easy button, it doesn't exist 𝗚𝗼𝗼𝗱 𝗻𝗲𝘄𝘀? There is an 𝘦𝘢𝘴𝘪𝘦𝘳 button which means >> A new playbook to grow AUM >> Sales is people first, story centered, data backed >> Fund mgr's thought leadership powers lead generation Building a successful fund business (any biz) is never easy It's easier with a guide by your side We can keep using the old playbook and expect it to create different results, faster results But there's a definition for that... you know what it is right? 🤪 = 📌 We help fund managers & teams use different to get better 📌 See my featured section to schedule a call

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What level of growth makes you a venture backable company? I’ve had the growth conversation with founders twice this week, so sharing some thoughts. A key metric we look at is year over year (YoY) growth. What we see: 🌱 An early stage company needs above 3X YoY growth to stay on a venture backable track. 🔥 4-10X YoY growth gives you a competitive raise. In case you saw the news about the Smartsheet take-private deal announced this week, in the current chilly IPO environment plus the impact of AI on the cost of software creation, we can probably expect to see more PE exits for software companies. Anything between 1X - 3X year over year growth is going to be very attractive to PE, who love the stable cash flows from SaaS, and who may see 10-25% year over year growth in other sectors. Is 4-10X growth crazy fast? Yes. Will it be bumpy? Absolutely. More mature companies typically do slow down as they get past tens of millions in run rate. If you are growing more slowly at an early stage, you should consider whether raising more venture money is the right path. There are different possible outcomes and its always wise to think through the trade-offs.

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No one tells founders or aspiring VCs how different a VC can operate depending on the type of firm they are. This is only something I learned after being in the industry for years & after speaking to multiple VCs about their roles. In this week’s newsletter, I’ll be breaking down 6 different types of VC firms and how it impacts your day-to-day as an investor and how they show up for you if they invest in your company. The VC firms vary by: - Limited Partner base (aka where their capital comes from) - Investment stage - Check sizes - Ownership targets - Diligence timeline - Investment objectives (aka the reason for investing) - Control levels (aka how they support their portfolio companies) - Risk appetite Don't miss this one: https://lnkd.in/gvK3_KJ6 #venturecapital #startup #founder #recruiting #hiring

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Balderton's €1.3bn raise for European startups sparks debate: Does a bigger VC fund lead to better outcomes? First, consider: 💲 Larger rounds demand bigger funds, but returns get harder at scale 💲 $100M fund needs $1bn exit at 10% ownership for a single 1x return 💲 Most early-stage VCs target 3x returns, investing in 30+ companies 💲Management fees (typically 2%) grow with fund size Plus, the current landscape: Giants like Balderton, Index, and Accel are raising massive funds, while smaller firms stick to sub-$200M and focus on early-stage startups. Many VCs have maintained their previous fund sizes, while others are downsizing or struggling to raise new funds (or even returning un-invested capital to investors, as CRV recently announced they will do). Thus, weigh up the trade-offs: Larger funds (≥$500M): 📈 More firepower, full-cycle support 📉 Risk: Pressure to deploy capital, potentially lower returns Smaller funds (≤$200M): 🔍Agility, focused support, higher potential multiples ❌ Limited late-stage participation The future of European VC may not be one-size-fits-all. As the ecosystem matures, perhaps there's room for both Davids and Goliaths. What's your take? Would you bet on a nimble $150M fund or the muscle of a €1B+ vehicle? Source: Sifted #EuropeanVC #FundStrategy #StartupInvesting PS 🔔 Follow me for strategies and resources for startups and VCs! There's a better, streamlined way to raise capital: 💸https://foundersuite.com/ for startups 💸https://fundingstack.com/ for VCs and investors

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Breaking into VC is hard because it requires help with: 1. Finding the open roles 2. Choosing which roles are a fit for you to apply to 3. Learning how to stand out in the application 4. Landing a first round interview 5. Knowing what to expect on the other side after landing the interview 6. Understanding if the offer is market and negotiating where necessary  7. Accepting the right role for you Then there’s a HOST of other things that are on the other side of accepting and starting in that new VC role. My hope is that I can help make someone’s life easier on some of these points. #venturecapital #startup #founder #recruiting

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Compare this to founders and startups from developing Asia. The avg pre-seed round would be around €100K and Founder's salary would be around €10K PA. Startups with lower burn will be invincible as Innovation and tech tools aren't geo-restricted anymore. #Startups #VentureCapital #Investment #Innovation #Funding

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Capital can be poison. I’ve said this before, but it’s worth saying again. We often laud the fundraising announcements. “STARTUP raises $X.XM round from INVESTOR” “INVESTOR launches new $XB fund” Looks good at first glance, right? ✳️For startups: - Raised capital at valuations that are too high restrict options - You may not be able to raise new rounds if numbers are not achieved - Typically need to grow faster by burning capital, increasing risk - If new capital round does not happen, layoffs typically follow ✳️For VCs and funds: - More funds is good, but quality deals need to be made - Size of funds needs to correlate with size of opportunities in the market - Too large a fund could result in struggles to deliver promised returns to investors across the board - Resulting in careless allocation of funds and pressure on portfolio for exits to meet fund timeline Bigger isn’t always better. Giants can wreck ecosystems when they stumble - as we’ve seen in the months and years preceding. Size wisely.

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When I started in VC, a GP told me that ‘if you’re not a top 5 investor for at least some portion of founders, you won't make it in this business’ As the market gets more competitive than ever before, learn why it’s essential to be an "N of 1" firm "N of 1" firms break away from the competition to monopolize the market for deal opportunities. The most remarkable firms of the VC industry have managed to become "N of 1"s via innovation and/or execution, such as -Arthur Rock, THE earliest VC - First Round Capital, THE institutional seed firm - Andreessen Horowitz, THE platform firm - SoftBank Investment Advisers, THE "capital cannon" - Emergence Capital, THE cloud VC - Y Combinator, THE accelerator Others (like Sequoia Capital, Benchmark , Union Square Ventures, IA Ventures and Kleiner Perkins) have had "N of 1" investors (those are that just THAT much better than anyone else) propel to dominate the market If I were a LP, the only question I'd be asking is "does this firm have the potential to be a "N of 1" firm? I'm hopeful we/Equal Ventures can #startups #venturecapital #fundraising #lps https://lnkd.in/eGU3nnCk

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Dear Funded Founders, So you’ve raised somewhere between $1–5M. Everything is “going great.” You’ve built a little bit of a team, you’ve found some early test users of your mostly built product, and your investors leave you alone to operate how you want. BUT.. Your user retention isn’t as strong as it needs to be. Your investor network isn’t as big as it needs to be. Your product needs another key feature, but you’re low on cash. VCs don’t seem to think you can grow your customer LTV fast enough. You want only the best investors, and that requires knowing VCs in San Francisco. You don’t have time to network with a bunch of VCs; you’re busy growing your business. Your retention isn’t high enough and doesn’t have enough of a sample size to show VCs. You have a great business, but VCs don’t think it’s venture-backable. Revenue isn’t growing consistently enough to raise more capital. You should be farther along than where you are at this point. Your CAC is too expensive for a traditional VC business. Your market just isn’t as big or popular as expected. Nobody on your team has sold a business before. Well, don’t you worry. I’ve heard it all before, and I’ve helped many founders get around these investor pushbacks to go on and successfully raise millions of capital. As the legendary fundraiser and entrepreneur Bill Fisher says: “Great businesses don’t raise capital, great stories do.” So, here’s the plan to ensure you can raise capital: First, please submit your information to the link below. I’ll then follow up, research your company, and reach out so we can schedule an intro call. What we’ll do on that call is go over your current fundraise pitch and investor pipeline. We’ll come up with a 12-week plan on how we can craft your ask so that it appeals to a very specific investor base. We’ll work on targeting those investors so that you can stop wasting time on the wrong capital sources, and then we will direct each conversation towards a clear date of when we expect the docs to be signed and capital wired. I’ll push you hard to move through this process and ensure we meet fundraise deadlines in a highly structured manner. If that all sounds good to you, please take the time right now to submit your info, and I’ll get started on my end with putting together a fundraise plan for you. You'll get the same skills I used to raise $10.8M ~Don Stein

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Dear Funded Founders, So you’ve raised somewhere between $1–5M. Everything is “going great.” You’ve built a little bit of a team, you’ve found some early test users of your mostly built product, and your investors leave you alone to operate how you want. BUT.. Your user retention isn’t as strong as it needs to be. Your investor network isn’t as big as it needs to be. Your product needs another key feature, but you’re low on cash. VCs don’t seem to think you can grow your customer LTV fast enough. You want only the best investors, and that requires knowing VCs in San Francisco. You don’t have time to network with a bunch of VCs; you’re busy growing your business. Your retention isn’t high enough and doesn’t have enough of a sample size to show VCs. You have a great business, but VCs don’t think it’s venture-backable. Revenue isn’t growing consistently enough to raise more capital. You should be farther along than where you are at this point. Your CAC is too expensive for a traditional VC business. Your market just isn’t as big or popular as expected. Nobody on your team has sold a business before. Well, don’t you worry. I’ve heard it all before, and I’ve helped many founders get around these investor pushbacks to go on and successfully raise millions of capital. As the legendary fundraiser and entrepreneur Bill Fisher says: “Great businesses don’t raise capital, great stories do.” So, here’s the plan to ensure you can raise capital: First, please submit your information to the link below. I’ll then follow up, research your company, and reach out so we can schedule an intro call. What we’ll do on that call is go over your current fundraise pitch and investor pipeline. We’ll come up with a 12-week plan on how we can craft your ask so that it appeals to a very specific investor base. We’ll work on targeting those investors so that you can stop wasting time on the wrong capital sources, and then we will direct each conversation towards a clear date of when we expect the docs to be signed and capital wired. I’ll push you hard to move through this process and ensure we meet fundraise deadlines in a highly structured manner. If that all sounds good to you, please take the time right now to submit your info, and I’ll get started on my end with putting together a fundraise plan for you. You'll get the same skills I used to raise $10.8M ~Don Stein

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Dear Funded Founders, So you’ve raised somewhere between $1–5M. Everything is “going great.” You’ve built a little bit of a team, you’ve found some early test users of your mostly built product, and your investors leave you alone to operate how you want. BUT.. Your user retention isn’t as strong as it needs to be. Your investor network isn’t as big as it needs to be. Your product needs another key feature, but you’re low on cash. VCs don’t seem to think you can grow your customer LTV fast enough. You want only the best investors, and that requires knowing VCs in San Francisco. You don’t have time to network with a bunch of VCs; you’re busy growing your business. Your retention isn’t high enough and doesn’t have enough of a sample size to show VCs. You have a great business, but VCs don’t think it’s venture-backable. Revenue isn’t growing consistently enough to raise more capital. You should be farther along than where you are at this point. Your CAC is too expensive for a traditional VC business. Your market just isn’t as big or popular as expected. Nobody on your team has sold a business before. Well, don’t you worry. I’ve heard it all before, and I’ve helped many founders get around these investor pushbacks to go on and successfully raise millions of capital. As the legendary fundraiser and entrepreneur Bill Fisher says: “Great businesses don’t raise capital, great stories do.” So, here’s the plan to ensure you can raise capital: First, please submit your information to the link below. I’ll then follow up, research your company, and reach out so we can schedule an intro call. What we’ll do on that call is go over your current fundraise pitch and investor pipeline. We’ll come up with a 12-week plan on how we can craft your ask so that it appeals to a very specific investor base. We’ll work on targeting those investors so that you can stop wasting time on the wrong capital sources, and then we will direct each conversation towards a clear date of when we expect the docs to be signed and capital wired. I’ll push you hard to move through this process and ensure we meet fundraise deadlines in a highly structured manner. If that all sounds good to you, please take the time right now to submit your info, and I’ll get started on my end with putting together a fundraise plan for you. You'll get the same skills I used to raise $10.8M ~Don https://lnkd.in/dj3wZCZW

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Should you go into VC straight out of undergrad? Here’s my take 👇 For early stage investing, I think you can learn everything you need to on the job so no prior experience is absolutely necessary, though it could be helpful. So from the pure day to day tasks perspective, I think you should be fine right out of school. However, I think there are two major things that put you at a disadvantage with no prior work experience: 1. You don’t have a robust network, you’re starting from scratch. 2. You haven’t learned how to be a full time worker in the workforce. For 1. VC is all about networks. In order to see the best deals, to diligence companies, to help portcos and so much more, you need a robust network. Often times, the best VCs have the best networks. Out of undergrad, you’re starting from zero so the ramp will be harder. For 2. Often times working at a VC firm is like working at a startup esp at the early stages. As someone learning how to navigate the workforce for the first time, it’s helpful to have more structure to your days w clear tasks to complete. VC is often more autonomous & self starting than that. Going from undergrad straight into VC, you can lose the opportunity to adjust to being a full time employee in a structured setting. So my overall sentiment on undergrad to VC is you can do it, but there are advantages and disadvantages to doing so. Generally you’d probably benefit from getting other work experiences under your belt before jumping into this world. This is just my opinion though. Open to all discussion! #venturecapital #startup #founder #hiring #recruiting

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Founders, you're missing out on your biggest multiplier. Scaling feels like an uphill battle. Resources are stretched thin. Growth is slower than you'd like. But there's a game-changer at your fingertips. Leverage. 1. Leverage through technology: - GitHub automated collaboration for millions with code written once. - Canva created features that add exponential value without extra cost. 2. Leverage through capital: - AWS used initial funding to build infrastructure that startups rely on. - Shopify invested in growth to accelerate their trajectory. 3. Leverage through people: - Stripe hires engineers who automate, reducing manual workload. - Slack's small team built a product used by millions without massive expansion. Why does this matter? Because leveraging technology, capital, and talent lets you do more with less. It scales your impact. Cuts your costs. Boosts your growth. So ask yourself: Are you obsessing over leverage? Because if you're not, you're leaving massive growth on the table. #BrainDumps | BrainDump #105

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Too many founders whinging about increases in taxes need to take a chill and ask if they benefitted from EIS and SEIS schemes for their business. These schemes are only available to certain startups that take external funding but not available to startups that don’t. This is unfair. Those schemes give huge tax breaks to investors that give startups money. Nowt wrong with that I hear you say. Well, it’s essentially a way of having the people’s taxes fund your indebted startup. Be grateful! Here’s the thing, most of those startups fail. The tiny few that succeed end up being bought out most of the time and end up off shore anyway. Ultimately costing the taxpayer one way or the other. I think we need to review the criteria of what startups benefit from government funding and it should be ones that don’t then run to off shore lands whenever they want to throw their toys out of the pram.

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