Most first venture funds are decided before the first check is written, by five numbers: how many companies, at what check size, at what ownership, with what reserves, over what period. Venture returns follow a power law, and portfolio construction is how a fund positions itself to catch the outlier and own enough of it to matter.
LPs read the construction model before the deal stories, because a model is something they can stress test. The question they run is simple: at your real entry ownership and real prices, does one big winner return the fund? Models that cannot answer it, or that assume ownership their check sizes cannot buy, lose the room in minutes.
VC Lab, whose 950+ accelerated firms invest 85% at pre-seed and seed, published the full guide: the five decisions in order, a worked $12MM model end to end, the fee and recycling fine print, and the failure modes that recur across hundreds of Fund I plans.
Want the full breakdown? Read the complete guide on GoVCLab →
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This content is provided by VC Lab, the YC for VC. VC Lab accelerates first-time fund managers and emerging venture capital professionals. Learn more at:
https://GoVCLab.com
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Need guidance on how to start a VC firm? This guide on starting a VC covers everything from fund formation to LP relations:
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Stay visible to potential LPs and partners by learning how to use LinkedIn to build credibility and attract LPs in this guide:
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Learn how top-tier VCs build repeatable sourcing systems that attract the best founders and deals before anyone else:
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VC Lab is part of Decile Group. Decile Group provides training, tools, and capital to emerging managers and limited partners through our comprehensive ecosystem:
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Learn about Adeo Ressi, inventor of the SAFE note, CEO of Decile Group, and Executive Chairman of the Founder Institute.
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