The 210 Steps Needed to Set Up a VC Fund
We had an insightful discussion with John Sharp , Managing Partner of Hatcher+ (pictured), which provides insights into the process of setting up a venture fund.
When Hatcher+ set up its Fund II, they thought that they’d be up and running within 6-9 months. The process ended up taking >18 months to get to the desired level of operations… but Hatcher+ used that experience to build a systematic approach that reduces the time needed to create an investment vehicle and build up operational support from months to days, or even hours.
Q: What were some of your reasons for early optimism in setting up Fund II? Maybe the question should be “How difficult (or easy) was it to set up a venture fund?”
We just had no idea how many steps we needed to walk through to create a venture fund. We know now - because we've codified it - and the answer is at least 210. While there are probably several other steps that we still need to add to that list, we're quite confident that 210 is close to the minimum number of steps.
Q: Where can an aspiring manager find this list of 210 steps?
We've made our list available for anyone to check it out on our website. Better still, we're taken all of our learnings, developed a ton of code, and created a better approach to creating investment vehicles – with the help of licensed fund managers.
Q: What has Hatcher+ done to dramatically reduce the time required for setting-up of a VC fund?
Let me first define what we mean by operation set-up and support. We’re talking about the ability to create an operating platform, choose from a range of fund structures, add a fund administrator, choose an audit firm, tap into a deal origination network, set-up an automated deal analysis process, and more. Beyond the proverbial engine room, our approach also supports basic due diligence with AI and automates fund accounting & reporting as your fund continues to grow.
But the first step in any systematic automating of a process is to go through the pain of doing it manually multiple times - and take notes. We've now done that, and those notes are no longer notes - they now constitute the documentation entries above the codified methods we've developed to enable the fast, easy, automated creation of investment vehicles.
In short, Hatcher+ has built an multi-award-winning, next- generation, venture-as-a-service technology (VAAST) platform to provide venture investors with a better way to build scalable, high-quality venture portfolios. We invite you to create your fund, build your syndication network, integrate your deal flow management and analysis - and manage your data, documents, cap tables, and portfolios on the VAAST platform.
Q: Who would this be most useful for?
People Venture investors who need serious scale, and for it to be done fast. This works for family offices, VCs, corporate VCs, and institutions, looking to create a fully operational venture fund in minutes.
About Hatcher+: A venture-as-a-service company that leverages deep learning, process automation, and global partnerships to enable scalable portfolios and index-style investor returns. If you’re interested in reviewing a demo of Hatcher+’s Venture-As-A-Service Technology ("VAAST") platform, schedule a demo with their team here.