Early stage or late stage, emerging fund or established fund. The all you need to know to choose the right fund for you.
Early Stage Fund: Early stage venture funds typically focus on companies that are in the early stages of their development, such as preseed and seed stage startups. Early stage venture funds typically invest smaller amounts of capital than later stage venture funds, and they often focus on businesses that are in industries with high growth potential. Early stage funds invest in companies based on their business model and their team, rather than their financials. The best skills to have as an early stage VC is having a great network, operating experience and being able to help founders scale. Many early stage VC profiles come from product, founder, operating and accelerator backgrounds. Well known early stage VC funds include A16z, Sequoia, and First Round Capital.
Late Stage Fund: Late stage venture funds generally focus on companies that are further along in their development, such as those that are in the growth or expansion stage. Late stage venture funds typically invest larger amounts of capital than early stage venture funds, and they often focus on companies that are in industries with more mature growth potential. Late stage funds analyze companies based on financials, revenue and traction. Much of the talent pipeline comes from Investment Banking and Private Equity as the skills needed is financial modeling heavy. Well known late stage VC funds include Tiger Global, IVP & Insight Partners.
Emerging Funds: If you are interested in working at a small fund and being able to see the full picture of what running a fund is like, then you may want to consider an emerging venture fund. These funds can offer a wide approach in what you can do (Fundraising, Sourcing, Due Diligence, Fund Ops) and you may have the opportunity to help shape the direction of the fund. However, these types of funds can also be more risky as many emerging funds lack the traction or institution capital more established ones have.
Established Funds: For those wanting to be at a more hierarchical organization that has name brand recognition, established partners and more, then an established fund may be a better option for you. These funds tend to have a longer track record of multiple funds and have institutional capital backing them. However, you will tend to focus on one side of the picture and less involved in fund operations or working with LPs.
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