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Charting Form Ds to roughly see the state of venture capital “fund” raising

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Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#21

Post by dheera »

dsr_ wrote: post #14
FirmwareBurner wrote: post #2

I think everyone knew, even without looking at any data, that startups were in a bubble thanks to Covid, when every "shoeshine boy" was studying to be a webdev at a start-up. Like how many food delivery apps that are actually profitable can the economy handle?

The problem is usually not "there are 300 food delivery services" but "there are three food delivery services and they control the market".

It's restaurants that don't want to deal with 300 apps. They will pick the top 3 and call it a day.

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#23

Post by lemonlym »

Havoc wrote: post #17

I'm in an adjacent space so quite interesting to me. Couple of concerns: 1) This Fund+Roman Numeral notation is universal among funds. Meaning this data isn't VC. It's use of fund structures. Real estate, PE, private credit maybe bit of hedge funds etc...and yes also VC. 2) Filling trends are affected by jurisdiction fashions so to speak. One of the big fund jurisdiction makes a small rule tweak and everything pivots…

Great points! Obviously this analysis is not unconfounded as the methodology is pretty scrappy.

On point 3, I think both large and small investment groups saw large growth. This is lightly supported by the spike in filings related to SPV as a service companies like Angellist.

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#25

Post by pentamassiv »

topaz0 wrote: post #24

Not that it would drastically change the conclusions, but do the numbers for "fund i" include the forms that say "fund ii" etc (by virtue of the fact that "fund i" is a substring of "fund ii" etc)?

It doesn't look like it does since "fund I" >> "fund II"

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#26

Post by FabHK »

pentamassiv wrote: post #25
topaz0 wrote: post #24

Not that it would drastically change the conclusions, but do the numbers for "fund i" include the forms that say "fund ii" etc (by virtue of the fact that "fund i" is a substring of "fund ii" etc)?

It doesn't look like it does since "fund I" >> "fund II"

As we'd expect if the numbers for "fund I" include both "fund I[^I]" and "fund II"?

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#27

Post by PhantomHour »

CalRobert wrote: post #9
JCM9 wrote: post #3

VCs were literally pitching to startups to take their money during the pandemic (there were several articles about that at the time). That nonsense will now come home to roost as companies that took money at those hyper-inflated valuations will now need to face reality. LPs that let their money get tied up in such nonsense are also about to head into a world of pain. I fear the present AI bubble will only exacerbate…

Geeze, I had a product with real users and a path to monetisation and I got ignored… is it because I was in Europe?

In part it'll be Europe, though VC in the "throw money into a fire" style does/did exist.

But VCs, especially in those days, bordered on antipathy for sensible business plans. They didn't want small businesses that would turn profitable quickly and grow sustainably. They wanted something with infinite growth ASAP that they could pump-and-dump on Big Tech or IPO suckers.

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#28

Post by PhantomHour »

dsr_ wrote: post #14
FirmwareBurner wrote: post #2

I think everyone knew, even without looking at any data, that startups were in a bubble thanks to Covid, when every "shoeshine boy" was studying to be a webdev at a start-up. Like how many food delivery apps that are actually profitable can the economy handle?

The problem is usually not "there are 300 food delivery services" but "there are three food delivery services and they control the market".

It's a business model problem; The "Uber" business model relies on a monopoly.

The business model is 1) "Have artificially low prices to push all competing business into bankrupty", 2) "Now that we're a monopoly, raise prices massively", 3) Massive profit, so long as no government starts doing anything about the fact that both steps #1 and #2 are illegal.

That business model fails the moment you have multiple startups dumping the market, none can move to step #2 because they'd bleed all their users to whichever competitor is still in step #1.

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#29

Post by lemonlym »

topaz0 wrote: post #24

Not that it would drastically change the conclusions, but do the numbers for "fund i" include the forms that say "fund ii" etc (by virtue of the fact that "fund i" is a substring of "fund ii" etc)?

You were actually right. I went and checked to see that some (not all) values were double counted. I've updated the graph to reflect this, and added a note. The trend remains identical, despite this change. Thanks for inspiring me to double check.

Re: Charting Form Ds to roughly see the state of venture capital “fund” raising

#30

Post by gdbsjjdn »

nkingsy wrote: post #11
JCM9 wrote: post #5

Earlier quoted context omitted.

Yep. Many / most aquihires are pretty ugly financially. While the headline sounds impressive (“X startup acquired for $250M”) the reality is that with preferred cap tables and terms most folks see nothing and investors are merely trying to recoup some losses or make a modest (less than S&P500 index fund return) return on investment. It’s basically a fire sale to salvage what’s left from the wreckage. Founders might g…

Don’t they usually get a better stock package than the average new hire?

In my experience what the founders usually get is a bigger locked up retention package. The investors want the cash, and the acquirer wants the founders to stay.
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