New Venture Capitalists Find Strength In Numbers
Decentralised Venture Capital funds? VC 3.0? Techcrunch looks at a new breed of venture capitalists and how they are taking on the more established firms.
The core idea is that these small funds work collaboratively rather than competitively to find investment opportunities. Rather than closely guarding opportunities till each has been fully explored internally, these VCs share notes, run joint events and fill roles in each other’s portfolio companies.
But what makes VC 3.0 compelling isn’t Slack or even the young investors in it. Rather, it’s the idea that a more professional group like VC 3.0 provides greater inclusiveness to new investors than traditional backyard BBQs and house parties.
What little progress that has been made in bringing more diverse investors into the industry has mostly manifested in young first time fund managers. But even with limited partners on their side and a few million to invest, it can be tough to break into the old world social circles that are still responsible for establishing winners and losers in the Valley.
On occasion they even band together to form a syndicate to make a joint investment. There is a limit to collaboration of course and as each scales it become less efficient to work in a VC 3.0 arrangement and it’s every man for himself. But till that stage is reached, members of the collective here see their collaborative structure as more powerful than the individual.