Similarly, the portfolio companies of better-networked VC firms are significantly more likely to survive to subsequent rounds of financing and to eventual exit. "Controlling for known determinants of VC investment performance, we find that VC funds whose parent firms enjoy more influential network positions realize significantly better performance, as measured by the proportion of portfolio investments that are successfully exited through an IPO or a sale to another company. "Prestige" or "reputation" or "contacts" or "networks" or "relationships" or "connections" or whatever you want to call it may be in fact more important in VC than in the above industries, even PE. However, having read read the academic paper mentioned in the TechCrunch post above (Hochberg, Ljungqvist, and Lu), I think that the evidence points to exactly the opposite. I'd strongly disagree with this statement, even though I admittedly have no first-hand experience in the industry. Size, compensation and history are all not as relevant as they may be in other industries. The industry is fundamentally different from IBD or PE, no matter how badly insecure college juniors may want to rank them. As captk said, Union Square isn't on the list and it's arguably the best VC shop in NYC. Ideating:This sort of prestige shit doesn't quite work in VC. What about Or a firm like Highland Capital Partners? Or newer firms, such as Bain Capital Ventures (founded in 2001)? How are their reputations / performance?Īs an aside, here's a TechCrunch post on the "Top 100 Networked VCs" discussing the correlation between contacts and performance: … Surprised Union Square Ventures didn't make the cut.Īll very impressive firms though, a good list. Bessemer, Greylock and Venrock are also all very impressive, would probably move them up the list. Austin Ventures as well to a degree, Polaris and Battery also. I also think Summit and TCV arguably could be moved off this list, not because they're not great firms, but because they have really moved up market more into growth equity. Never heard of Sevin Rosen.and found this about them returning capital: … I heard NEA has had some problems as of late - raised a huge fund that exceeded their ability to deploy it effectively, and as a results their returns have been terrible.
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