VC Fund Examples - Investment Differentiation
- 01:33
Walk through a hypothetical example of three VC funds with different areas of focus.
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Now let's look at these three VC funds.
AVC fund focuses on investing in B2B and SaaS companies. It's primarily interested in the autos, industrial, or manufacturing industries, and it targets companies that sell products or services to business enterprises.
BVC Fund has more of a consumer focus and invests in B2C companies in consumer sectors, including retail, media, consumer, and advertising. It targets companies that sell products or services to consumers. The CVC fund is interested in AI tech and SaaS within the healthcare sector. Its primary interest is in companies with a SaaS business model, which can be targeted at either or both business enterprises and consumers, just as long as the product is an AI tech product. It is also not unusual for VC funds to specifically indicate which sectors they are particularly focused on to make the fundraising process more efficient and transparent. It also suggests to entrepreneurs that this fund may have managing partners or advisors that have experience in these sectors. This can provide significant value add to their portfolio of investment companies.