Are you VC material? Understand VCs and WIN the game.

A lot of founders try to raise from VCs, but reality is that only about 0.05% to 0.5% of startups manage to secure VC funding.

The reason? Many.

1. Most Startups Are Not VC Compatible

Venture Capitalists have investors themselves, who have high expectations for a return on investment.

So VC need to find THE BEST startups in the world to minimise their risks and give that return.

VC are ultra rational animals.

2. Venture Capitalists Have Investors Themselves

VCs raise funds from limited partners (LPs), which can include institutional investors, pension funds, endowments, and high-net-worth individuals.

These LPs expect significant returns on their investments because they are taking on high levels of risk by investing in VC funds.

This dynamic creates intense pressure on VCs to generate outsized returns, often in the range of 10x or more on each investment.

Because VCs are accountable to their investors, they need to be highly selective and aim to back the very best startups that can generate such returns.

These returns usually come from a small fraction of their portfolio, meaning they rely on a handful of "home-run" companies to make up for the many others that fail or underperform.

3. VCs Need to Minimize Risk While Maximizing Returns

Despite their willingness to invest in risky ventures, VCs are extremely focused on minimizing risks 👇