Best Practices in Raising a microVC Fund

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In raising a microVC fund, consider the following:

It takes 12 to 18 months to raise an initial fund.

Most funds start off in the $10M to $25M range.

With a successful funding record, one can move up to the $35M to $50M range.

Limited partners will be family offices and high-net-worth individuals.

In raising funds, consider these best practices:

Show how your fund is unique and differentiated from other funds.

Make clear the vision for the fund and what it will accomplish beyond the return to the investor.

Show the competitive advantage of the team and its network.

Highlight the track record of the team in deploying capital.

Look for an anchor investor who will lead the fund and place a sizable amount to start.

Build out the team so the fund is not a solopreneur endeavor.

Fund closings range from 3 to 5 rounds over the course of the raise.

Give incentives to investors to join the fund, such as access to direct investments that are doing well.

Consider these best practices for your microVC fund.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

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