Now let's look at the different stages of funding that each of these three operate in. The startup companies in AVC fund are at the series A stage, which suggests that their product is already in the market generating some revenue, and is showing some level of market traction. In contrast, BVC fund is targeted at seed stage investments, which suggests that these startups have yet to show any meaningful market traction. An entrepreneur would expect the value add from these two firms to be different. AVC managing partners would have expertise in scaling a revenue generating product into multiple markets, developing multiple sales teams, and creating a cost efficient platform to scale their business. BVC Fund, on the other hand, would likely demonstrate expertise with testing products in market with customers, not enterprises developing a go-to market strategy and evaluating the best customer acquisition approach.

CVC Fund is a different type of fund altogether as they are looking to invest in later stage companies that need capital and growth expertise to scale their business and products in new markets expand internationally, and to focus on generating profits and moving towards an exit.

It's also likely that all three of these examples of VC funds would have developed external networks of industry experts, potential employees, other companies who may offer strategic support and other like-minded investors that can also be tapped to add value for their portfolio companies.

While some entrepreneurs are solely focused on raising a target amount of investment capital, the more strategic entrepreneurs will also evaluate VC funds based on what value they offer and what kind of impact they can make on their company.

Earlier stage VC funds tend to be more hands-on in both the frequency and level of interaction with their invested companies. This is because it'll be helping to create the roadmap for company growth, ultimately helping to devise the strategy to turn the idea or concept into a profitable business. A VC fund that played the lead investor role in a round of capital will typically take a board seat at the startup they have invested in. Companies may also offer additional observer seats, which allow other VC funds that invested in the round or other colleagues of the lead VC funds to join and contribute to the board meetings. Observer seats do not have any voting rights. Term limits, and no options are granted to the individuals.