How to write a venture capital fund Thesis?
A successful venture capital fund thesis follows a proven template used by over 60% of new VC firms:
"[Fund Name] is launching a [$x MM] [Stage] venture fund in [Country/City] to back [Geography] [Sector/Market Companies] [with Secret Sauce]"
Essential Components
Three key elements form the foundation of a strong fund thesis:
- Fund Identity: Name, size (ideally under $10MM for new managers), and investment stage
- Geographic & Market Focus: Clear definition of operational base and target market
- Secret Sauce: Unique value proposition backed by quantifiable metrics
The Secret Sauce Hierarchy
The most compelling metrics for demonstrating credibility, in order of importance:
- Investment exits
- Investment performance
- Capital raised
- Sales closed
- Companies helped
- Network size
- Years of experience
Best Practices & Common Pitfalls
Successful Example:
"Terra Ventures is launching an $8MM seed fund in São Paulo to back Brazilian B2B SaaS companies, leveraging the GP's experience scaling 3 SaaS startups to $10MM+ ARR"
Key Pitfalls to Avoid:
- Being too broad in focus
- Making unquantifiable claims
- Mismatching fund size with strategy
- Lacking credible differentiation
Read more here: https://govclab.com/2025/04/14/vc-fund-thesis/
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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:
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