Abstract

Raising a venture capital fund can be a difficult and time-consuming undertaking. The authors of this article surveyed 20 founders/GPs from a wide variety of U.S.-based VC funds to analyze, both quantitatively and qualitatively, the critical challenges these firms faced in raising their first fund. The responses reveal a variety of approaches that new firms have taken, and identify certain factors that increased the probability of success for each approach. The article also segments funds by “demographics” (fund size, fund era, investment profile, etc.) to determine which factors were most important to which kinds of funds. Finally, the authors examine two firms in greater depth to provide a case study of two widely differing, but equally successful, fundraising approaches.

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