Re:YC Series A Program Investor Access
by baccredited on Wednesday January 16, 2019 @03:32PM
(#18924818)
Ugh - only deep pocketed individuals or investment funds can apply. For a second thought they had opened it up FundersClub/Wefunder style where any random person could take part. (Or at least accredited investor)
Re:YC Series A Program Investor Access
by akharris on Wednesday January 16, 2019 @04:19PM
(#18925382)
The goal here is to reach investors that can lead series As.
Doing that requires a fair amount of capital given that:
a) the average A last year was $8m and
b) the lead is expected to write a check for the majority of the round.
I think that seed rounds are generally a better fit for the types of funds you mentioned. It's possible that these funds will develop over time to be able to lead As. I look forward to that happening and having them participate in YCA.
Re:YC Series A Program Investor Access
by joshu on Wednesday January 16, 2019 @04:35PM
(#18925564)
VCs are expected by their LPs to get 15-25% ownership. So there is no way for an investor to invest $2m on an $8m round and get to that level of ownership.
Re:YC Series A Program Investor Access
by xchaotic on Wednesday January 16, 2019 @06:34PM
(#18926720)
Worth mentioning that given the current cheap money, a lot of the investment is leveraged, on credit or timed. So you don't have to have 2m sitting idle in a bank to lead a round.
Re:YC Series A Program Investor Access
by timavr on Wednesday January 16, 2019 @08:34PM
(#18927545)
As far as I understand VCs(General Partners) don't hold investment money. They just get paid fees and have a mandate from Limit Partners to invest, so when they want to invest, they just call on LPs to transfer the money.
I imagine each VC fund has a multitude of LPs and they each manage cash based on their own strategies. The key is that they have enough liquid assets to meet the obligations in a timely manner.
Obviously, each fund is set up separately and might have a different structure.
a) the average A last year was $8m and b) the lead is expected to write a check for the majority of the round.
I think that seed rounds are generally a better fit for the types of funds you mentioned. It's possible that these funds will develop over time to be able to lead As. I look forward to that happening and having them participate in YCA.
I would guess ~$2m, but you gave the impression that it would be more about $5m.
I imagine each VC fund has a multitude of LPs and they each manage cash based on their own strategies. The key is that they have enough liquid assets to meet the obligations in a timely manner.
Obviously, each fund is set up separately and might have a different structure.
Is that true?
In the sample numbers given in the form [https://docs.google.com/forms/d/e/1FAIpQLSeT0G1nuYWUn71cV36o...], the lead doesn't have the majority:
Yappy, Total: $20M, Our check: $8M, Yes