David Zhou’s Post

“The line that sits for me is you got to pick well, you got to coach well, and then you got to finance well – and the financing includes the exit.” - Jeffrey Rinvelt You know that homecoming feeling or the one you get when you catch up with friends at the 10-year reunion, THIS episode was that for me. We've had Renaissance Venture Capital's Jeffrey Rinvelt on since Superclusters' Season 1 as a post-season episode with Martin Tobias, and 3 seasons later we finally have him back. Jeff, who has every right to be a standalone episode. Let me elaborate. 1/ Who is the exit manager? Jeff may be the first person I've heard this from. The exit manager. Most VCs are geared to be great pickers. Even more so, if you've spent time at another large VC institution, but the difference between a fund manager and an investor is that the former also requires you to "exit well." It's not a "I'll figure it out when I get there." But how will you be disciplined enough to hedge against downside risk without capping too much of the upside. Does your fund strategy include when you'll remit the capital, not just how you'll commit? If not, you need to either hire an exit manager, or be that person yourself. Moreover, Jeff also answers the age-old question: Should VCs be public market investors? Should they hold past the initial liquidity window? 2/ $40M is the minimum viable fund of funds size for 2 people. When on 1% carry, that's $400K a year between 2 people, as well as back office expenses and support staff. The latter 2 often cost more than what thinks. Separate from the episode, a seasoned founding GP once told me to prepare between $150-200K on pure travel expenses per year to meet founders and LPs. Running a fund of funds is no less different. 3/ Renaissance measures GPs on net IRRs, as opposed to net TVPIs. FoF managers are measured on IRRs by their LPs. Jeff did caveat 2 things: a/ As an LP, if you are to measure by IRR, you must do your homework. Where are the gains coming from. Paper marks vs real marks. How much is realized? b/ Net IRRs take about 5-6 years to settle in. Anything before then is too volatile to measure. All this and more! Full episode and show notes in the comments P.S. Jeff may try to break your heart. Trust me, it'll make sense, but you'll have to listen till the end of the episode.

By far, Winter Mead is one of the most deliberate thinkers I know in the LP landscape, and what makes it even better is there are two upcoming opportunities where you can see Winter's mind and decisions in action: 1/ His new book How to Setup a Venture Capital Fund: https://lnkd.in/gnqGkRJC 2/ Next week Coolwater Capital is hosting their next Demo Day and not only is the guest list top notch, but also the funds that are demoing. Which personally I'm excited to be there. More deets below: https://lnkd.in/gwYDnqu9

How many First Cheque’s have you listened to? Lucky listeners now have over 20 insightful episodes of the First Cheque podcast to learn from, including: 💡 INVESTOR INTERVIEWS 💡 Co-hosts Cheryl Mack from Aussie Angels and Maxine Minter from Co Ventures interview world-class leading investors: Ash F., Marvin Liao, ⚡️ Michael Batko, Elicia McDonald, Craig Blair, Samantha Wong, Anabel Lippincott Paksoy, Elaine Stead, 😱 Rayn Ong, 🌱 Judy Anderson-Firth, Daniel Gavel, and Jessy Wu. 💡 DEEP-DIVES 💡 Episodes with co-hosts Cheryl and Maxine exploring key investing topics: 🎯 Portfolio Allocation: Diversification vs. Concentration Strategies Unpacked 💲 The Debate Over Follow-On Investments in Early-Stage Investing 🧠 The Art of Getting to Conviction: Strategies for Successful Investing 💰 What is a Fund of Funds: A Primer on Investing in Venture Capital 📚 Angel Investing: On Ramps, Communities, and Maximising Learning 📊 Reflecting on Lessons from Last Year ✅ First Cheque: Your Warm Intro The goal of First Cheque? Open-sourcing conversations and insights from experienced investors to support emerging investors to better their craft. 🧠 Let us know in the comments what you think of the first 20 episodes! ⬇️ Subscribe to First Cheque wherever you listen to podcasts. https://lnkd.in/gWEDF7hR -- Thanks to our sponsors for helping to make First Cheque possible. Vanta: Vanta automates up to 90% compliance, getting you audit-ready quickly and saving you up to 85% of associated costs. Join 7,000 global companies like Atlassian and Dovetail that use Vanta to build trust and prove security in real-time. Get 10% off here: https://lnkd.in/gzcRN4jA Scendar: Scendar is the OG startup accounting firm in Australia. Free 1-hour consultation about your Business' growth plans and finance needs. https://dayone.fm/scendar Turo: Turo is the world's largest carsharing marketplace and it's the perfect app for travel. Download the Turo app and book cars from $38/day. https://dayone.fm/turo

New episode released today! Today we release part 2 of Keith’s interview with his old friend Chris C., former CEO and founder of blooom and The Retirement Planning Group, now founder of Curtis Capital Advisors. Today’s conversation focuses entirely on the lessons Chris learned raising capital from some of the best VCs in the business, and the tactics and hacks he wishes he knew when he started. This is an incredibly helpful and tactical conversation that will help any entrepreneur raising any kind of capital. It is also a must-listen for investors for two reasons. First, learn what it’s like on the other side of the table. Second, the advice shared in this episode applies to raising ANY kind of capital, not just venture capital. Keith and Chris cover: - Raising money is sales. Get used to it. If that feels dirty or funny to you, you’re going to have to get over it. - Getting your mindset right for raising capital. - Why belief and mission are critical. - How to ask the right questions when talking to investors. - Developing a relevance filter for advice. - Getting referrals from and to VCs. - How to think about how much capital you need to raise. - How to get investors to an answer quickly, and how badly the slow maybe sucks. - Managing investors during diligence and closing. They cover so much in this conversation, and we think you’ll enjoy and learn a lot from both the wide range of topics and the tactical advice shared. Listen in and learn! Link in the comments. ⬇

Episode 4 of our Super Series with Foundamental is recorded, and it's packed with insights! Patric Hellermann and Shubhankar Bhattacharya dive deep into the key convictions that have shaped their unique approach to investing in construction tech. They reveal why they chase "vertical singularities" and how earned knowledge gives them an edge. Ever wonder how top VCs build trust with founders? The team shares their refreshing take on embracing discomfort and vulnerability in investor-founder relationships. They also drop some surprising lessons they've had to unlearn as VCs. Hint: networking isn't everything! First episode of the Super series will be free, but you'll want the full series to truly grasp how to succeed in construction tech investing. Your competitors are gaining these insider insights - can you afford to miss out on the knowledge that could shape your next big decision? Check this out : https://lnkd.in/ewZYfG_H and stay tuned for the launch on 11th September. #superseries

Episode 3 of Season 2 is finally out! “Diversification is potentially the only free lunch in investing.” I've been a big fan of Winter Mead at Coolwater Capital since when I first met him during my days at On Deck, and having seen many of my friends go through the program, I knew Winter had created something special for emerging managers. Naturally, we dug deep across Winter's experience of seeing 1000s of managers and having made many dozens of bets on emerging managers. Outside of the questions he asks himself to build an LP investment thesis, my favorite of which: 🌟 What made Hall Capital Partners LLC special and how it helped Winter grow immensely during his time there. - from mentorship to the endowment perspective to great office design and more. 📝 Diligence is a lagging indicator to fears and risks GPs introduce. The goal of diligence isn't to cover every single possible corner and get to 100% conviction. The goal of diligence in an asset class with information asymmetries and limited data is to overcome the key fears and risks that come with investing in a particular fund. To learn the difference between must-diligence and nice-to-diligence. 📍 Where to go looking for founders and VCs in the Bay Area. In this episode, Winter and I talk about what it's like to be an insider to the Bay Area and all the nooks and crannies locals go to look for entrepreneurial and investing talent. Yes, we namedrop, but this can be your cheat sheet if you're not local to SF. Of course, much much more. Maple syrup. The first person that got Winter into the LP world. The chip that Winter has on his shoulder today. Oh, and from popular demand, Winter is coming out with a new book, which I also highly recommend checking out. Full episode in the comments

Want to hear tactics and tips for raising capital from a seasoned CEO - someone who raised from some of the best fintech VCs in the business? Check out Part 2 of my conversation with Chris Costello, former CEO and co-founder of Blooom. Chris learned a lot raising capital for his fintech startup, and he's generous enough to share the most important lessons with other entrepreneurs in RBF Network's latest podcast episode. This is also a critical conversation for investors to hear so that they can understand what it's like to sit on the other side of the table! We cover a lot of ground here and cover a lot of important concepts that I think are critical for #founders and #investors to understand: - Raising money is sales. Get used to it. If that feels dirty or funny to you, you’re going to have to get over it. - Getting your mindset right for raising capital. - Why it's so critical to really believe in your potential impact. - How to ask the right questions when talking to investors. - Developing a relevance filter for advice. - Getting referrals from and to VCs. - How to think about how much capital you need to raise. - How to get investors to an answer quickly, and how badly the slow maybe sucks. - Managing investors during diligence and closing. Take a listen and feel free to share feedback. I hope you enjoy! Link below!

Founder pro tip: learn when to listen to investors and when not to ✅ On the one hand, you want to be sure to actively seek guidance from your investors—they are there to help, after all. But leaning too heavily into this can leave you with little agency to make your own decisions and follow your intuition. As Rob Bailey put it in this week's episode of NY Seed Round with Justin Wolz: “It's really about developing your own unique, but really smart point of view that's constantly evolving rather than just reactively doing whatever some investor may have suggested off the cuff.” Link to the full conversation in the comments 👇

“The more constraints you have, the more conviction you will have in each manager.” From the value of solo GPs to concentrated portfolios to how to build deep relationships in the MENA/GCC regions, our latest episode on Superclusters with the one and only Raida Daouk El Jisr at Amkan Ventures is one for the ages, boasting a portfolio including the likes of Finn Murphy at Nebular and Ben Freeberg at Oncology Ventures! Just as she herself backs GPs who can run through walls, our conversation itself ran through walls. My favorite Raida lessons include: ❓ The one question she asks every reference at the END of the conversation. What is one thing this fund manager can improve on? No one is perfect. No fund manager is. References, especially on-list references, come back extremely positive which gives you a rose-tinted perspective of the truth. But as a capital allocator, you need to be able to see through the smokes and mirrors. It is also important that you ask that question at the end of the conversation instead of the beginning or the middle. As an LP, 1/ you need to establish rapport with the reference first, and 2/ you need to give time for the reference to get everything off their chest. 👩💻 Solo GPs are awesome for 2 key reasons: 1/ Partnerships, without explicit rules for decision making, move towards consensus thinking within the partnership, but venture is a non-consensus business. Moreover, time spent trying to convince the other partners of the deal is time better spent understanding the market, the founders, and the investments or sourcing net new ones. 2/ Partnerships are more likely to break up than a solo GP getting hit by a bus. It is also easier to underwrite an individual's ability to hustle than to underwrite a partnership's ability to collectively and individually hustle. Of course, much more in the full episode, which you can find in the comments

Episode 10 drops tomorrow. Dr. Elouise and I discuss the rise of Private Equity (PE) in the ProcureTech space. Differences in Venture Capital (VE) and PE investments: VC: -Minority stake (<50) -Earlier stage -Less established -Greater tendency to be hands off; greater autonomy of the portfolio company -Investment is about growth -Accelerate innovation because they are more technology focused; not afraid to let the companies they back challenge the status quo, take novel approaches, or even pivot -Lead with innovation and obsession with a customer -Recognized procurement was a space to play in during COVID, but now there is too much tech -Do a good job of solving problems, but they're standalone and companies are moving away from standalone solutions -Standalone are doing the cooler things, but making each piece of your procurement value chain using a point solution is costly and prohibitive from a process perspective PE: -Majority stake (>50) -More mature -More established -Do a great job of finding the ones that have the highest opportunity to integrate into an ecosystem and helping them do that -Help expand a company's Monthly Active Users (MAU) count but things like customer satisfaction, support and innovation slow a little -Help bridge that gap to more of a partnership or ecosystem play -3 – 5 years is the goal to flip/sell the company or break it up into smaller pieces to sell Other things we discuss: Procurement leaders struggle going from one environment to another (ie VC to PE). PE firm will say to their portfolio companies, across our portfolio we use Oracle or SAP, and anything you use needs to feed into that. PE's priority is not necessarily to grow – goal is to flip (could involve growth or chopping it into little pieces); only buy so they can exit. Purchasing new tech is often hinderance to a PE's strategy unless something is so broken they can’t flip it – example: no financial accounting system. PE firms often push the use of consolidated suppliers (have their own buying group to consolidate spend and use bulk buying power to negotiate better contracts). PE's often replace large swaths or entire executive leadership team and come in immediately wipe out staff (often have the new CEO 'clean house'). 🎧 Episode drops tomorrow at 9AM ET.