Jacob Jofe’s Post

Venture capitalists are embracing the secondary market as a viable option for generating exits in a market where liquidity events are scarce. The stigma around selling on this market is starting to fade. #VCJ #VentureCapital #Secondaries

Zombie VCs and EOL (End-of-Life) VCs quiet surges happen on the long downside of every major VC hype cycle for the past 3+ decades. Nothing new here besides the fund names and the sheer number of new funds and (mostly) new fund managers that have never weathered a VC downturn before. Why smart LPs track GPs as well, not just Fund or Vintage performance, and smart entrepreneurs always do their own fund due diligence before accepting a term sheet, as Zombie VCs always exist, in both good times and bad. Soak, Wash, Rinse, Repeat....

As per The Wall Street Journal, LPs are increasingly scrutinizing fund managers' valuations, causing prolonged fundraising timelines. Act One Ventures, for instance, took three years to raise its $73 million third fund, with increased LP scrutiny of portfolio companies' cash position and burn. Valuing private companies becomes challenging amid illiquidity, with differences in opinions on appropriate marks. Overvaluation by venture managers raises concerns among LPs, impacting trust. Venture fund returns have declined, and the gap between public and private company valuations raises portfolio valuation and exit strategy concerns. A record 15.6% of global financings in Q2 2023 experienced down rounds, contributing to heightened anxiety among LPs assessing potential private company insolvencies. 💭How do you think the current challenges in venture fundraising, marked by a record accumulation of unspent cash, increased scrutiny on valuations, and rising concerns about private company insolvencies, will reshape the landscape for both fund managers and investors in the coming years? Share your insights below. 👇🏼 ——— At AXIS Capital Markets, we specialize in global debt placement and secondaries for VC- and PE-backed companies. Follow us to stay updated on the latest developments in #privatemarket, #venturecapital, #privatecredit, and #privateequity.

In the dynamic world of venture capital, trends come and go, but the rise in secondary transactions is proving to be more than a passing fad. As reported by Sifted today, increasingly more of Europe's largest VCs are exploring portfolio sales as a means to generate much-needed liquidity in a market with fewer IPOs and exits. At TempoCap, our Managing Partner Olav Ostin spoke to with Amy Lewin about our experience in this space and how our dealflow has surged fivefold in recent times, with about half of our investments now in secondaries. These aren’t just portfolio sales from smaller players; several prominent European VCs have already made unannounced portfolio sales, while many others are considering it. As Olav Ostin mentioned, the current market conditions present a unique opportunity for secondaries firms. It's a buyer's market, and he anticipates that the liquidity position for VCs won't significantly improve this year. On the flip side, it could also be a strong year for exits, especially with increased interest from US buyers. For more insights on the growth of the secondaries market, check out the full article here: https://lnkd.in/eVezHr9C #venturecapital #secondaries #liquidity #portfoliosales

As the venture capital landscape transforms, one trend is gaining significant momentum - the rise of secondary transactions. I'm thrilled to share that TempoCap is at the forefront of this shift as we see more and more #CVCs and #VCs turning to single-asset and portfolio sales to generate liquidity in a market currently experiencing fewer M&A exits and IPOs.   Our deal flow at TempoCap has surged three to fivefold recently, especially on the portfolio side of our activity. This isn't limited to smaller players; even notable European CVCs and VCs are considering portfolio sales to generate some DPIs. It is probably the most sophisticated tech investor who is now considering secondary sales as a dynamic portfolio management tool.   Strategies vary across the board. While some prefer acquiring stakes in entire portfolios (LP secondary), we at TempoCap lean towards selecting a few standout companies within a portfolio, particularly those valued between €50-250m with disruptive technologies, significant revenue and fully funded business models.   Given the current market conditions, it's an opportune time for secondary firms. We predict the liquidity solutions TempoCap can provide will remain attractive for many years as an active way to generate some liquidity in a largely illiquid asset class (there are 9x more investments than exits in the European tech sector!).    For more insights, check out my comments in Sifted via the link below. Thanks to Amy Lewin for the insightful conversation. #venturecapital #secondaries #liquidity #portfoliosales

"I don't have any plan Bs. This is my plan B, so we have one shot to do this right." Amid a tight market for emerging VCs, Marell E. (KF Class 27) has increased Exceptional Capital's first fund from $30M to $50M. Read more about his journey in Business Insider. #venturecapital #emergingmanagers #vc https://lnkd.in/gwQe482Q

#StartupNews 🚨| Peak XV Partners is set to launch #PeakXV Anchor Fund— a permanent capital vehicle investing in new businesses and strategies, sources tell Shruti Malhotra. Details here ⬇️ | Young Turks

Are you considering a portfolio sale? A very insightful post from Amy Lewin (Sifted) about VCs and secondary markets. I’m curious which VCs in my network are considering selling (part of) their portfolio companies. #alwaysbelearning #sharingknowledge #founders #investors #firstdegree

"Don't count your chickens before they hatch". That's particularly true in venture capital. It's hard to know which of your investments will be fund returners and how the overall portfolio will fair, eventually. But, as we all know, there are many other ways to say "it ain't over until it's over". "The future isn't carved in stone" is another one which means that the future can always be changed. And that's probably the right attitude the industry should adopt. Making sure all of their portfolio companies get a proper chance to exit and LPs a transparent visibility on these exits. "It ain't done until the fat lady sings" you say? I get that. So let's wait until the market (the fat lady) recovers? But just so you know, sitting on your hands is not what you are being paid for by your LPs. Rather, go get that liquidity, junior! #venturecapital #investing #portfolio #liquidity #secondarymarket #secondaries #exits PS. Did I mention that the #dpisquad at 109 Capital can help? Sure thing, I did! https://lnkd.in/eZzZkanv

[Edit: April fools 🙃 ] Introducing the world's most diversified private market investment vehicle: Harmonic's Fund of Fund of Fund of Funds is finally live! We're making it possible to get broad exposure to all the best startups by signing just one check. Wild response from our early testers: "In an industry dominated by bad ideas that sound like good ideas, the FoFoFoF is a revolutionary reversal of the status quo. After all, why try to beat the market if you can simply be the market?" - Geri Kirilova "When one invests in a VC fund, one is both hunter and prey. But by investing in a FoFoFoF, I feel like I'm not just the Apex Predator... I also get to be the Apex Prey." - Jay Kapoor “FoFoFoF is an investor in our funds, and because FoFoFoF offers risk-free returns, we can just take their capital, apply 10x leverage, and invest it right back into FoFoFoF. Talk about a free lunch! Internally we're calling this our "ouroboros initiative" and we couldn't be more excited about it.” - Leo Polovets "With our investors being part of FoFoFoF, it’s like playing 4D chess with partnerships and exposure for Buildstock. As we aim to 10x our revenue in the mystical world of endless fund layers, we're not just selling construction materials—we're stacking up strategic alliances like Legos" - Kathryn Thiele AIA CSI -- find out more at