Thu. Jan 20th, 2022

Even after the unprecedented year we had in 2020, VC markets picked up in 2021 and founders raised 157% more capital in Q2 2021 compared to the previous year. Global VCs have invested $268.7 billion as of July 2021, already exceeding the total investment amount in 2020.

In emerging markets, where our company Seedstars focuses, venture capital flow has grown 40% year over year, but still represents less than 4% of global volumes, despite making up the majority of the world’s population . Whether you think this is a bubble, one fact remains true: capital is a commodity.

Some capital will flow faster than others and investment conditions must be considered, but assuming all things are equal, the real value lies outside of capital. It is in the knowledge, network and support that an investor brings to the table.

It’s not just a matter of market perception or a signaled trend. De Santis Breindel asked CEOs what the most important evaluation criteria were when choosing a VC firm. The company’s reputation came first, followed by its ability to add value to portfolio companies in addition to financing. How has the industry reacted to this?

“Smart Money” and the VC Platform

At some point, the concept of “smart money” slipped into the VC language, alluding to the idea that some money also came with highly sought-after expertise and the likelihood of crowding out other investors.

Today, the evolution of the concept has brought us the VC “platform”. Smart money was certainly a catchier phrase, but not institutional enough to become something official. The concept of a platform, on the other hand, gives more room for innovation, but still leaves most founders (and even some platform managers) confused. So the big questions are: what exactly is a platform? How does it bring value? Do you need it as a startup? How can you evaluate it? Read more.

T-shaped platforms and the Tetris fit

Keep two rules in mind:

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