We often talk about venture LPs as faceless, anonymous institutions — but more than 40% of LPs into VC funds under $100M are individuals.
Yes, these folks are accredited investors so they're doing pretty well. But they're also actively putting their money to work in small startups.
We need individual venture LPs to write checks to emerging funds, who in turn support the next generation of founders (especially first-time founders).
For the fund managers out there, individual LPs will make up effectively a third of your LP base even in $100M-$250M funds.
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Individual LPs are more than half of all LPs into funds under $10M.
Individual LPs contribute more than a quarter of all committed capital into funds under $25M.
They contribute one-fifth of capital into funds under $100M.
The other major LP contributors across all fund sizes are family offices and larger institutions (which can be sub-segmented into lots of different categories including endowments, pensions, etc).
This is another reason why the liquidity crunch across venture is so acute at the moment. Individual LPs may not be able to support another investment into a new emerging fund without returns from the prior ones recycling back into the ecosystem.
Here's to individual LPs (and to a few more exits this year).
Big report on emerging manager fund performance goes live Monday, get your copy here: https://lnkd.in/gc_qFy9M
#limitedpartners #venturefunds #VC #emergingmanagers #LPs
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