Venture Capital (VC) fund

Описание: Venture Capital (VC) Structure, Flow, Key Terms, Accounting, Investment Metrics & Top VC Firms (with Examples)
1. Venture Capital Fund Structure & Flow (With Examples)
A VC fund is structured as a Limited Partnership (LP), where the General Partner (GP) manages the fund, and Limited Partners (LPs) provide capital.

VC Fund Flow & Example
🔹 Fundraising: The GP raises capital from LPs.
Example: Sequoia Capital raised a $2 billion early-stage fund in 2023 to invest in AI startups.

🔹 Investment: The GP invests in startups.
Example: Andreessen Horowitz (a16z) invested $150 million in Clubhouse at a $4 billion valuation.

🔹 Value Creation: The fund helps the startup scale via mentorship, hiring, networking, and strategic advice.
Example: Benchmark Capital invested in Uber’s early stage and helped with regulatory challenges.

🔹 Exit Strategy: The fund realizes returns via IPO, M&A, or secondary sales.
Example: SoftBank Vision Fund made $34 billion when ARM went public in 2023.

🔹 Distribution: Profits are shared among LPs and GPs based on the 80/20 split (20% carried interest for GPs).
Example: In the 2012 Facebook IPO, Accel Partners earned $10 billion, while GPs received a $2 billion carry.

2. Key Venture Capital Terms (With Examples)
📌 Carried Interest (Carry): The GP’s share of profits (usually 20%).
Example: If a16z exits an AI startup for $1 billion, and LPs receive $800 million, the GP gets $200 million (20%) in carried interest.

📌 Management Fees: A 1.5%–2.5% annual fee for fund operations.
Example: Sequoia Capital’s $2 billion fund earns $40 million annually in management fees (2%).

📌 Pre-Money & Post-Money Valuation:
Example: If Stripe is valued at $10 billion pre-money and raises $2 billion, its post-money valuation is $12 billion.

📌 Convertible Notes: A debt that converts into equity later.
Example: Airbnb raised $1 billion in convertible debt during COVID-19, later converting into shares.

📌 SAFE (Simple Agreement for Future Equity): A flexible investment instrument.
Example: Y Combinator startups raise capital via SAFEs before setting a valuation.

📌 Dry Powder: Unused capital reserved for future investments.
Example: Tiger Global had $6 billion in dry powder after its 2021 fundraise to invest in late-stage startups.


Example: Lightspeed Ventures invested $50M in Udaan’s Series D and added $30M in Series E.

3. VC Accounting & Reporting (With Examples)
✔️ Capital Calls & Distributions
Example: If Accel Partners has $500 million fund, they may call 20% initially ($100M) and the rest in phases.

✔️ Fair Value Measurement (ASC 820 / IFRS 13)
Example: SoftBank had to write down WeWork’s valuation from $47 billion to $1 billion due to failed performance.

✔️ Carried Interest Calculation
Example: If Benchmark Capital makes a $2 billion exit, LPs get $1.6 billion (80%), and the GP gets $400 million (20%).

✔️ Management Fees
Example: Andreessen Horowitz’s $4.5 billion crypto fund collects $90 million (2% fees) annually for salaries, operations, and research.

✔️ Fund Financials (NAV Statements, P&L, Cash Flow Reports)
Example: SoftBank reported a $32 billion loss on Vision Fund’s portfolio markdowns in 2022.

4. Investment Metrics in Venture Capital (With Examples)
📊 Internal Rate of Return (IRR) – Measures annualized returns.
Example: Sequoia’s early investment in WhatsApp had an IRR of 143%, when Facebook acquired it for $19B in 2014.

📊 Multiple on Invested Capital (MOIC) – Total value divided by invested capital.
Example: Lightspeed Ventures invested $8M in Snap, which returned $2 billion (MOIC = 250x) when Snap went public.

📊 TVPI (Total Value to Paid-In Capital) – Gross multiple of returns (DPI + RVPI).
Example: Tiger Global’s 2020 fund had a TVPI of 3.2x, meaning LPs saw a 3.2x return on invested capital.

📊 DPI (Distributions to Paid-In Capital) – Cash returned to LPs.
Example: Accel returned $6B to LPs after the Facebook IPO, achieving a high DPI.

📊 RVPI (Residual Value to Paid-In Capital) – Value of remaining investments.
Example: Andreessen Horowitz’s portfolio had an RVPI of 2.5x, showing strong unrealized gains.

5. Top 5 VC Firms & Their Investments (With Examples)
1️⃣ Sequoia Capital
🔹 Investments: Apple, Google, WhatsApp, Airbnb, Stripe
🔹 Example: Sequoia invested $60M in WhatsApp, which was sold for $19B to Facebook.

2️⃣ Andreessen Horowitz (a16z)
🔹 Investments: Coinbase, OpenAI, Instacart, Stripe
🔹 Example: Invested $50M in OpenAI, and now OpenAI is valued at $80B.

3️⃣ Accel Partners
🔹 Investments: Facebook, Dropbox, Flipkart, Slack
🔹 Example: Accel invested $1M in Facebook and exited at $10B after IPO.

4️⃣ Benchmark Capital
🔹 Investments: Uber, eBay, Twitter, Snap
🔹 Example: Benchmark’s $12M Uber investment turned into $6.8B at IPO.

5️⃣ Tiger Global Management
🔹 Investments: Byju’s, Flipkart, Stripe, Databricks
🔹 Example: Invested $1B in Flipkart, which was later acquired by Walmart for $16B.