I oftentimes find myself pitching venture capital as an asset class. The easy pitch is 'look at what David Swensen has done with the Yale endowment'. That said, think it's important to understand the characteristics of the VC asset class that has largely driven Yale's success relative to its peers, and I'm

  One of poker's most crucial decisions is, do I see the flop or don’t I see the flop? There are 169 different two card starting hand combinations in hold’em poker. If you play hold’em correctly, you’re going to be selective and toss away the vast majority of hands you’re dealt. We've been investing

  Fred Wilson of USV recently wrote a great note on whether it is better to back the team or the product (the “jockey or the horse”) in VC investing, noting that "When I think about the big wins we have had over the years, they almost all exhibited a combination of a

  Intuitively, one would expect that a 90% selection accuracy rate at distinguishing good from bad investments leads to the same % of winners in the portfolio. However, because this selection accuracy rate is applied on a dealflow that intrinsically contains a very small number of winners, a VC's accuracy rate doesn't directly

  I get asked some variation of this question a lot, “When you invest, what is a good expected return?” Generally speaking, I frequently hear early stage tech/life-science investors state that they're targeting a 10x return. While this is a quick/easy benchmark, we at Brightstone believe that returns are not simply a function of

  At Brightstone we do a lot of work supporting our portfolio companies in financial budgeting and modeling. At our firm, we believe that startups should be run using a metric-based approach, and we're constantly monitoring our portfolio companies' metrics. The metrics range from standard fare, such as Customer Acquisition Cost (CAC) and

  As investors, we face buyout offers for their equity at every point in a company’s lifecycle. Founders face the same offers. It can be tempting to sell. We typically don’t. If an investment is doing well, someone will try to buy it from you. We will say ‘no’ unless we can return 1x

  1.) Domain expertise and a track record of successfully executing against a vision The first thing we look for is domain expertise in the industry a founder is operating in. How many years of experience does he/she have? In what roles did they operate that were relevant to the new business? What relevant successes can he/she

  I often get asked questions around how many investments Brightstone makes in a typical year and how many investments we intend to carry in a single fund vintage. Our firm usually makes one new investment per quarter, which equates to one to two new investments per partner per year, or four to five