How to Leverage Micro VC Funds to Build an Angel Portfolio


This post is by Charlie O’Donnell from This is going to be BIG


Vincentadultmancropped.png

Fund investing, like adulting, is boring.

That’s the first thing anyone trying to raise a fund needs to understand, as well as anyone thinking about investing in one. The partner at the fund, the VC, gets to do the fun part—the meeting with founders, vetting deals, negotiating, helping, etc.

You get, if you’re lucky, a Powerpoint and some financials once a quarter.

So what’s the point?

Fund investing can be additive to your angel investing and there are two main arguments for it:

  1. Getting indirect benefits from being invested in one or more funds.

  2. Having a better overall portfolio of venture capital by adding funds into the mix.

Side Benefits

Ideally, a small fund could get you the following, but you have to ask to make sure it’s available:

  1. Co-investing opportunities. Are investors allowed to come into deals that the fund does side by side with the fund? This creates a source of deal flow for investors who aren’t out there full time creating opportunities. If you’re not showing up at all the events, putting out content, constantly networking, generating enough deal flow—more specifically enough high-quality deal flow—being able to co-invest next to experienced professionals can really boost your funnel. That being said, some funds charge extra fees on top of these opportunities—fees that might, in the long run, actually be costlier than the investments through the fund itself. Brooklyn Bridge Ventures doesn’t, but it’s pretty common that a fund might create an SPV for its co-invest opportunities and charge (Read more…)