Thread by @TurnerNovak

Quick @BananaCap_ Q4 update (unaudited)

- Fund 1 at 1.83x MOIC (gross), 1.54x TVPI (net of fess, carry)
- All 🍌🧢 at 1.57x and 1.41x
- Gross (Net) IRR on Fund 1 at 276% (205%)
- Fund 1 was 73% deployed
- $26.2m AUM ($16.2m in SPVs), ~81% in follow-ons (some my prev investments)

66% of Fund 1 capital is invested at Pre-Seed/Seed, and 54% with US HQs (JOKR + Umba skew this, US HQs but operate mostly in LatAm + entirely in Africa)

In Q4 we deployed more capital at Pre-Seed/Seed than Series A and beyond, and increased ecom + fintech exposure (mostly ex-US)

Outside of North America, our two most active markets were France and Pakistan with three new investments in each country. I'm blaming @2lr and @aatif_awan for this, but do think both are good things 😂

We invested in 14 new companies in Q4 and made 5 follow-on investments (3 via SPVs). Average Q4 check size was ~$325k. Largest was $3.1m.

Fund 1 will likely have 60 port co's and 35 core investments (initial check + follow-ons are more than 1.5% of portfolio).

Fund 2 will have ~35 total port co's, 20 core, and 10 that make up 50%+ of the fund. Seems like big change, just means fewer small checks + moving most of what today has gone in SPVs into the fund. This allows us to give a better founder experience when writing larger checks.

We’ll also put 2-3% of Fund 2 in a few new co secondaries + 4 to 6 public checks at ~$150-200k each. This will build a track record to raise a public fund in 3-5 years to further support founders post-IPO. Part of the original vision for Banana, but didn't have capacity this year

Our average 2021 pre-seed entry valuation was $8.67m, Seed was $37m (pre-revenue seed was $29m)

Overall, average valuation on fund checks by quarter (this includes pre-seed through D):
Q1: $59m ($57m excluding follow-ons)
Q2: $95m ($102m)
Q3: $32m ($22m)
Q4: $44m ($44m)

All returns are extremely early and skewed due to timing (and on paper, of course), but this was encouraging - we raised SPVs to augment fund checks in a few high-conviction Seed rounds, and that bucket has outperformed the fund-only Seed checks in terms of early MOIC 👀

Most common follow-on investor in 2021 across all my Gelt + Banana port co’s was a16z at 4x.

Most common co-investors were Geometry Ventures, Julian Shapiro, and YC at 4x. Tiger, Kleiner, and Lachy Groom were all at 3x (very likely I’m missing some people and funds here).

This was also huge - we were recognized for our role in the record VC fund announcements to start 2022

https://twitter.com/erenbali/status/1479553190890651648?s=20&t=ovc0Z5e7qCSvEylNF6A9gQ

Most importantly, @olivia_deng_ officially started in October. She is now better than me at both Twitter and TikTok and adding incredible amounts of value for portfolio companies.

In 2022, my broad expectations are for later stage investors to continue creeping earlier. I'd assume the *average* Series B+ portfolio deployed in 2021 is in a rough spot, and most of the growth equity / crossover universe will continue investing earlier.

Banana will always be an opportunistic fund, but I expect we continue leaning earlier and international throughout 2022 (all depends on what we see) before we do too much beyond Series B (and we’ll likely deploy ~2x more in B's than A's).

Thanks for reading, and check out prior updates here:

https://twitter.com/TurnerNovak/status/1456100836799561729

And to clarify this was 2021 as a whole, not just Q4

https://twitter.com/TurnerNovak/status/1489076561735208964