Ravi Kumar caught up with Michael Beckerman on his podcast in an hour long chat. One of the things during the conversation Michael mentioned that there is a growing gap between VC money being pumped into the industry and actual adoption of technology in the industry.
Here’s how the conversation went.
Ravi: If adoption is not happening, where is the money going? Is it vanishing?
Michael: There’s a lot of venture firms, that, you know, make their money on fees and on the raise. So, you know, their goal though also needs to be to get the money out. Yeah, you don’t make fees on what you raise, you make fees on what you deploy. I’m not saying anything disparaging. It’s just, you know, there’s a lot of start a lot of venture for us to celebrate the size of what they’ve raised.
I don’t think that’s a good barometer either.
And there’s some great, great, great venture firms in our industry that you look at their portfolio, you look at their track record and when I put things in front of them just trying to help out the industry and I’ll put a, a founder’s deck in front of a venture firm and the feedback that I get and the thoughtfulness that goes into it, it’s, it’s really enlightening to understand where the smart money is going.
So I think again, less of an emphasis on how much is being raised and how much is being deployed is where’s the smart money going.
And I think, you know, there, there’s a dozen, if not, if two dozen great great investment firms in our industry that I’m very, very close to.
Ravi: You mentioned, not to disparage anybody, but do you want to highlight the ones that you think are doing a great job as a venture fund?
Michael: But, oh my gosh, there’s so many thoughtful ones and again, you don’t have to name everybody.
I think there are some firms that have demonstrate extraordinary performance. Here they are:
I am gonna get in trouble because I, but, you know, just get go to their websites, look at their portfolio and great great companies that are in there that have either exited or scaling and leading the way not to say that there’s not pain in there too.
Ravi: What are the traits of a good proptech VC?
Michael: The due diligence of VCs is really exhausting in a good way, which tells you that they’re really being incredibly thoughtful. And then the other thing I look at is their LP network.
Knowing that adoption is so hard to come by, you really want to take a look at who their LP network is. Understanding which venture firms are just throwing logos against the wall and which ones really have team members that, whose job it is to help the startups get adoption within their LP network. And so that’s, that’s really, really important to look for. And the, the, the ones that I mentioned do a phenomenal phenomenal job in that regard.
Enjoy the video from Michael:
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By Ravi Kumar
