Article: Why Institutional Investors Should Double Down on VC

In this article, Why Institutional Investors Should Double Down on VC, Dan Malven of 4490 Ventures summarizes the findings of a working paper, “Has Persistence Persisted in Private Equity? Evidence from Buyout and Venture Capital Funds,” researched and written by Robert S. Harris, Tim Jenkinson, Steven N. Kaplan & Ruediger Stucke, and published by the National Bureau of Economic Research (NBER).

 

The paper, published in November 2020, contradicts the conventional wisdom that only a small handful of marquee VC managers are worthy of investment by institutional investors.

Instead, using a data source that was previously unavailable to researchers, the researchers found that VC firms’ outperformance is much more broadly distributed than previously understood. The decades-long belief has been that only top-quartile VC funds outperform public equities, but the data show that half of all VC fund managers outperform the public markets, and are therefore worthy of institutional investment.

The State of U.S. Early-Stage Venture: 1Q21

This time last year, the venture industry was upended by the COVID-19 pandemic. Most startups had trouble raising funds, even on investor-friendly terms. But by 3Q20, early-stage venture showed, and Q4 saw the industry come roaring back to have its in terms of markups.

In “The State of U.S. Early-Stage Venture: 1Q21,” AngelList Venture and Silicon Valley Bank report that that 2020 momentum has carried over, and outline the data and trends that have particularly marked the first quarter of 2021.

2021 Trends in Entrepreneurship Report

The Trends in Entrepreneurship Report brings together expertise and data from academia, industry and policymakers to highlight relevant topics facing entrepreneurs and investors today.

Our aim is for this information to guide leaders in their decision-making, as well as to highlight gaps in research and policy for leaders in academia and government.

 

The 2021 report, produced by the Kenan Institute of Private Enterprise and the UNC Kenan-Flagler’s Entrepreneurship Center, explores the following:

    • Initially, we explore the state of startups, small businesses and investments after a year – and global pandemic – have passed.
    • Then we dive into one of the hottest areas today: health innovation. We highlight trends related to
      COVID-19, as well as other relevant topics, such as how AI and machine learning are impacting innovations in health.
    • After that deep dive, we zoom out to explore broader trends related to investment structures, the impact of
      economic recovery funds distributed by the government, and other capital formation specific to entrepreneurs and small businesses. One of the major highlights is the disparity in funding as it relates to support for underrepresented groups in entrepreneurship.
    • We then take on the theme of diversity, equity and inclusion in entrepreneurship, highlighting some of the
      massive experimentation of the past several years to create more inclusive ecosystems through case studies and models, with a hope to inspire action and research related to these topics.
    • We conclude by examining factors inside organizations related to teams and talent, and how those elements play into the ongoing success of organizations.

Report: Why New Black Venture Capital Will Generate Outsized Returns and Help Close the Racial Wealth Gap

Why New Black Venture Capital Will Generate Outsized Returns and Help Close the Racial Wealth Gap” – a new report by Culture Shift Labs.

 

About Culture Shift Labs:
Culture Shift Labs (CSL) is a diversity and innovation consultancy that provides services under three pillars: Advising, Strategy, and Activation. Since 2006, we have been a recognized leader in integrating social and financial returns in ways that improve businesses and society. Our Knowledge + Network Formula powers those outcomes in tangible ways

 

2020 VC Human Capital Survey

What does the venture capital (VC) industry workforce look like in terms of demographics? What is the current state of VC diversity, equity, and inclusion (DEI)? The VC Human Capital Survey, powered by Deloitte, National Venture Capital Association, and Venture Forward, answers these and other questions for VC firms seeking to expand the diversity of both their teams and portfolios.

The third edition of our VC Human Capital Survey assesses the state of the US VC industry workforce, with a special focus on DEI. Results from this edition were benchmarked against findings from the first and second editions, which were originally conducted in 2016 and 2018. Conducted in 2020, this third edition requested firm demographic information (e.g., investment stage focus) and demographic information for each employee (e.g., gender and race). Additionally, firms were asked to provide information regarding their talent management practices and DEI programs.

While there have been other industry assessments of VC diversity, this survey provides a more holistic perspective. We gathered data from VC firms of all types and sizes, examined DEI for a variety of groups across all types of positions, and assessed firm talent management strategies. (Learn more.)

Report: Guidance and Best Practices for Investors on Diversity & Female Entrepreneurship

Guidance and Best Practices for Investors on Diversity & Female Entrepreneurship is a report published by the British Venture Capital and Private Equity Association.

The report was commissioned by the Alison Rose Review and HM Treasury, and includes tactical guidance for investors to create an inclusive pipeline and portfolio. It was inspired by broad recognition in the investment community that diverse and inclusive portfolios have substantially lower risk and better performance.

 

High-level, the report recommends:

  • Implementing specific tactics to recruit diverse talent to your investment firm
  • Adopting specific practices to create an inclusive culture at your investment firm
  • Using tried-and-tested strategies to remove bias from the investment process
  • Engaging with portfolio companies using validated tools and tactics
  • Signing up to the Diversity VC standard

SVB Report: Healthcare Investments & Exits Mid Year 2020

In this report, Silicon Valley Bank explores the mid-year state of healthcare investments and exits around the world.

Startups and Small Businesses Generated $1.3B in Economic Impact and 11,564 Jobs in 2019 – JumpStart

Startups and small businesses throughout Ohio and New York were thriving in 2019, generating at least $1.3 billion in economic impact on regional economies, according to a recent study published by Silverload Consulting based on data collected by JumpStart.

This study is a snapshot of startups and small business activity in Ohio and parts of New York, but the total impact of entrepreneurial startups and small businesses is even greater. The 2019 economic impact report includes data from 701 companies who responded to the survey and met qualifying requirements (at least one employee plus revenue or payroll.) 242 (34%) of companies led by people of color and 346 (50%) led by women responded.

Paradigm

Paradigm is a consulting firm that designs data-driven strategies, implements programs with impact, and trains employees and leaders for success.

While Venture Forward does not endorse commercial products, Paradigm produces a great deal of research, resources and events that they make available to the public for free.

 

Paradigm Events: Learn about the latest diversity, equity, and inclusion research, trends, and tactics used by best-in-class companies at one of Paradigm’s events. From full-day, interactive Paradigm DEI Labs to timely webinars, Paradigm’s events are designed to help drive impact.

Inclusion Insights: Paradigm’s magazine contains recent news, articles, press releases, information on upcoming events, and white papers, showcasing the importance of diversity and inclusion in the workplace.

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Pandemic Impacts Entrepreneuring Women at Work and Home

The COVID-19 pandemic has impacted all business owners. The Diana International Research Institute (DIRI) team wanted to uncover just how it impacted a specific category of business owners: women.

How are the entrepreneurs responding to the revenue decline? Nearly 40 percent of business owners are deferring or reducing executive pay, more than one-third are delaying payment, and one-quarter are reducing employee hours.

The survey found that women-owned businesses face key structural inequalities due to smaller size and business age, and these businesses also are over-represented in the industries hardest hit by both need for essential services and the economic shutdown.