Thread by @jasonlk

Been investing for 5.5 years. I have returned almost no capital, but have lead 1 round from seed investor->unicorn, 1 more coming shortly, and another hopefully a bit later in year.

So I have at least learned some things.

Here are my learnings for New GPs/Managers, fwiw:

1-/ in the end, you will make the most, and have the least headaches, raising what it takes to execute your strategy. but no more

each extra $1 you raise is another $3-$8 you have return. that means another $10m = another $50m to return = another unicorn or close

not worth it

2-/ if you have good-but-not-great dealflow, a concentrated strategy is better. it is simply easier. if you meet with 4-10 >truly great< start-ups each year, just invest in 1-2.

you need great dealflow to do diversified and achieve 4x+.

diversified is harder.

3-/ you can make money investing in founders you don't 100% trust and believe it. but it's a loooong 10+ year journey. is it worth it?

4-/ there are no amazing deals in the Lower 48 at least. investing because the price is a "good deal" can make money but not a lot.

5-/ your strategy and insights into the venture market are probably 3-4 years old. challenge them.

6-/ there are 300+ new seed funds. no one cares about your "strategy". there are at least 5 other funds exactly like you.

7-/ you basically need a unicorn-a-year if your fund size is >$40m or so to do >well<. every year. folks that say otherwise are not shooting for 4x-5x+.

8-/ ownership isn't everything, but you probably need 2x as many unicorns if your ownership is lower than 7%-8%. are you up for that? boy it isn't easy.

if you aren't, get a real job. trust me.

9-/ you need to commit for 15-20 years to make real money. make sure you have done the math.

A $20m starter fund with 2 partners than does 2x net (top 30%) = $200k a year to each partner ... spread over 10 years. And you have to wait a long time to get the $$$.

10-/ if you are insanely great, you can buy yachts, fly private, whatever.

if you are insanely great at many things -- one of the very best -- including YouTube, that's true too.

If you aren't, do something else.

11-/ Finally, and most importantly, do not do venture because it seems EASIER than real work.

It is easier than real work. But it is not easier to be great at it.

It also seems glamorous at first, but it isn't. You'll experience:

a-/ partner drama. not a firm without it.

b-/ your deal flow drying up. you have to evolve your playbook every 3-4 years. harder than it sounds.

c-/ intense competition.

d-/ LPs that lose faith in you

e-/ the ennui of being ... fungible.

12-/ So if you are aware of 1-11, OK making very little real $ unless you are one of the very, very best, AND willing to truly hustle AND commit for 15-20 years

Then

Go Forth and Conquer

Being 1st investor into CEO -> unicorn is rewarding. Rest? Fun as angel. As VC? Less so.