Agenda
Recording for ClassHow Winter & Spring Terms Will WorkWinter TermSpring TermKey IdeasHow the Fund is DesignedTodos
Recording for Class
Start Recording
Link Available
How Winter & Spring Terms Will Work
Fall
Introduction — theory & simulation
Winter
Application, rounds 1 & 2
Spring
Application, rounds 3 & 4
Winter Term
Key Deliverable: Each student joins a team of other students (3-4 per team) and presents about deal flow twice during the term. A pitch includes an investment memo and a presentation.
Presentation Template - Link
Week | Content | Assignment |
1 Jan 11, 2024 | Kick-Off | ㅤ |
2 Jan 18, 2024 | Pitch 1: Choose a Deal & Team | Team’s share their team assignment (owner, memo, presentation, [optional: research]) |
3 Jan 25, 2024 | Pitch 1: Prep | Submit assets (research, memo, presentation) - 50% complete |
4 Feb 1, 2024 | Pitch 1: Prep | Submit assets (research, memo, presentation) - first complete draft |
5 Feb 8, 2024 | Pitch 1: Presentation Day | ㅤ |
6 Feb 15, 2024 | Pitch 2: Choose a Deal & Team | Team’s share their team assignment (owner, memo, presentation, [optional: research]) |
7 Feb 22, 2024 | Pitch 2: 50% of assets complete | Submit assets (research, memo, presentation) - 50% complete |
8 Feb 29, 2024 | Pitch 2: First full draft complete | Submit assets (research, memo, presentation) - first complete draft |
9 Mar 7, 2024 | Pitch 2: Presentation Day | ㅤ |
10 Mar 14, 2024 | Discuss screening calls | ㅤ |
Spring Term
Key Deliverable: Each student joins a team of other students (3-4 per team) and pitches 2 deals during the term. A pitch includes an investment memo and a presentation.
Week | Content | Assignment |
1 Apr 4, 2024 | Kick-Off | ㅤ |
2 Apr 11, 2024 | Pitch 3: Choose a Deal & Team | Team’s share their team assignment (owner, memo, presentation, [optional: research]) |
3 Apr 18, 2024 | Pitch 3: Prep | Submit assets (research, memo, presentation) - 50% complete |
4 Apr 25, 2024 | Pitch 3: Prep | Submit assets (research, memo, presentation) - first complete draft |
5 May 2, 2024 | Pitch 3: Presentation Day | ㅤ |
6 May 9, 2024 | Pitch 4: Choose a Deal & Team | Team’s share their team assignment (owner, memo, presentation, [optional: research]) |
7 May 16, 2024 | Pitch 4: 50% of assets complete | Submit assets (research, memo, presentation) - 50% complete |
8 May 16, 2024 | Pitch 4: First full draft complete | Submit assets (research, memo, presentation) - first complete draft |
9 May 23, 2024 | Pitch 4: Presentation Day, Public Showcase (invite select guests) | ㅤ |
10 May 30, 2024 | End of Year Celebration | ㅤ |
Key Ideas
How the Fund is Designed
Diagram Class → IC → COO
The fund is 100% owned by PSU Foundation (”Chief Operating Officer”)
COO has signing authority (i.e., final say on investments)
Investment Committee (IC) recommends deals to the COO
Class recommends deals to the COO
Investment Policy Statement
Revised Investment Criteria
Criteria
30% — Impact
20% — DEI
20% — Return / ROI
10% — Geography
10% — Educational Opportunity
5% — Optics
5% — Diversified Portfolio
How VCs Make Money
$100M fund
$2M in Management Fees to GPs
For GPs for operating the fund
Annual fee
2% of capital commitments = 2% * $100M = $2M
Scenario 1 $1B in net profits from exits
$100M in Contributed Capital to GPs & LPs
How much money you put in
$180M in Carried Interest to GPs
GPs get their rewards
$720M in Contributed Capital to GPs & LPs
Remainder is distributed equally
Scenario 2 $50M in net profits from exits
$50M in Contributed Capital to GPs & LPs
How much money you put in
$0M in Carried Interest to GPs
GPs get their rewards
$0M in Contributed Capital to GPs & LPs
Remainder is distributed equally
Power Law — what really drives big net profits
“6% of deals drive 60% of returns”
Preferable to find one “unicorn” ($1B exit) than 10 $100M exits
What makes a lead investor
Write the term sheet and negotiate the deal with the entrepreneur
Sufficient expertise in term sheets
Put the most money in the round
Win the most if the startup wins
What perks do lead investors get
Serve on the board (i.e., decision-making power)
Controlled the preferred series of stock (e.g., better financial position for exits)
Close relationship with the founders
What that means for follow-on investors
Less influence on valuation and terms (must choose among existing options)
Less contact with founders
Good enough to make a handshake deal.
Todos
Students share about deal flow
E8
Founders First
Dreamward VC
HumanKind Homes (Kari)
Stiira (Arsh)
Pacmodo (Arsh)
Dayo (Arsh)
Howl at the Spoon (Arsh)
Rose City Robotics (Arsh)
Tender Loving Empire
Goddess Mousse (Arsh)
Oili - www.oili.app (Clark County)
Novuson - www.novuson.com (King County)
Sip Herbals - www.sipherbals.com (Multnomah County)
Think about teams