Leo Polovets

Added it to my list. Looking forward to it :)

Enjoyed it, learned a lot. What wasn't clear to me is the argumentation why A funds need to deploy money through B/C/etc. rounds as well while you don't need to do that as a seed fund. Are you implying that all A funds are too big?

E.g., if I follow that argument, could you do an A fund that’s slightly smaller and that focuses on initial checks only? With all that being said, isn’t the main argument of the A funds that doubling down on the winners is what creates the best ROI?

I think there's a tension because bigger fund = bigger salaries + more budget for events, portfolio services, staff, etc. So there's pressure to go up. Also, founders often expect follow-on support from investors -- so you need to account for that even if that's lower ROI.

I think for some companies doubling down has great ROI, but never as good as the early rounds. E.g. FB was a good investment at basically any stage, but investing an extra $1m at the Series A would've been better than investing $100m in Microsoft's round 2 years later.

A firms could also do more net new investments instead of follow-ups with same fund size? I assume them not doing it means lack of additional great deals or acknowledgment that picking net new investments is riskier than doubling down?