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When we think about the makeup of a venture capital fund, the investors are often top of mind - along with their portfolio companies. However, many have described Platform to be the connective tissue between the two. VC Platform encompasses pre and post-investment activities, think everything outside of writing the checks. As you can imagine, this role can include many functions but when done right, is custom to the fund.
While some firms may focus on talent acquisition others may put a lot of their efforts into networking and community building. The “live by design, not by default” approach to Platform roles is what will ultimately make them valuable for an individual fund. The need for this value is becoming imperative as founders are no longer taking capital blindly. When asked about the necessity of Platform roles, Joshua Goodfield, Executive Director at VC Platform put it like this,
With more and more VCs popping up both fresh firms and veteran firms really need to differentiate themselves from others. We’re in a world where everyone is trying to write checks into promising companies and so firms are repositioning themselves in the fight for new deals on what their unique value propositions are.
Moderate: up to 10% of the core team in the fund’s investment period in a Platform role.
Significant: 10% or more of the core team in the fund’s investment period in a Platform role.
As mentioned, building out of a Platform team asks you to look across multiple pre and post-investment activities. Pre-investment activities could include marketing and branding for the fund, hosting events and workshops, or building fellowship programs. These initiatives are aimed at supporting deal flow and maintaining a positive public perception of the fund. Post-investment activities could range from talent acquisition, ESG, founder networking, and business development. On this side, the focus is on the portfolio companies and catering to their needs as they build.
For early-stage funds, a recommended strategy is to identify your core strengths and strive to outperform in those areas. For a later stage, Platform should transform into a team that can effectively navigate the entire VC value chain, adopting a holistic approach. While Platform roles have typically appealed to generalists, more funds are hiring Platform specialists with expertise in core areas. These areas include Marketing, Investment Operations, Talent, Business Development, Community, and ESG.
Allie Mullen is the Director of Platform at Wireframe Ventures and the only non-investor employee. As a team of one, she built the Platform function from the ground up. Here are some of her tips for getting started:
If you’re just starting to build a Platform team or want to get a pulse on your current system, the VC Platform Strategy Matrix is a good place to start. The tool walks you through 10 major components of Platform and asks you to rate the level of development from 0 (None) to 4 (Dedicated & Validated). The final product is a visual representation of your fund's platform focus. Cory Bolotsky, Director at VC Platform and the creator of this tool makes a good point,
The expectation should not be for any firm to be strong across all ten of the components. Rather, most firms will identify two to five of the components that they want to focus on getting to Stage 3 or Stage 4, and will have a number of components that they want to keep at Stage 0 or Stage 1 — that is typical.
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Interested in learning more about the VC Platform role? Check out these additional readings!