Lisa Edgar of Top Tier Capital Partners on how limited partners evaluate venture fund managers. What LPs look for in first meetings, portfolio construction, fees, carry, and why most emerging managers fail.
Highlights
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LPs evaluate fund managers like VCs evaluate founders — pattern recognition is everything
Edgar reveals that LP due diligence mirrors VC due diligence: track record, team dynamics, differentiated strategy, and reference checks. The frameworks are isomorphic.
The venture power law applies to fund managers too — most destroy value
Edgar: the majority of venture funds underperform public markets after fees. The top 5% of managers generate the vast majority of returns. LP skill is almost entirely about accessing that top 5%.