Is Venture Capital Right for You? Finding Your Why & Getting Fluent
Venture Capital Fundamentals (VC 101) | Class 5
Venture capital is an asset class often associated with institutions, but increasingly accessible to individual investors. In this lesson, we explore why investors consider venture capital and how to determine if it fits your goals, interests, and overall portfolio.
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What Is This Lesson?
An overview of why some investors choose venture capital. - Home
Who Is It For?
Those defining their approach to VC.
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Alumni Ventures and its personnel provide advice only to affiliated venture capital funds. Discussions and interactions with investors are not personalized advice for any participant.
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What You’ll Learn
- HomeWhy investors consider venture capital
- HomeThe role of diversification in adding VC to a portfolio
- HomeDifferent investor personas and how they may align with your goals
- HomeHow different goals shape a venture strategy
- HomeHow to evaluate if venture fits your approach
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Frequently Asked Questions
FAQ
Is Venture Capital Right for You?
When considering venture capital, one of the most common questions investors ask is: why include this asset class in a portfolio? For many, the answer begins with diversification. Venture capital offers access to an asset class that has historically been available primarily to institutions such as endowments and pension funds, allowing individual investors to broaden their exposure beyond traditional investments.
Beyond diversification, investors are often drawn to venture capital for different reasons, depending on their interests, goals, and stage of life. Some are technology enthusiasts who want to stay close to innovation and understand what’s coming next. Others are venture-curious, looking to learn about the asset class and gain exposure for the first time.
There are also investors who are focused on long-term impact, often referred to as legacy builders, who think about the role their investments can play in shaping the future. Others are more return-oriented, seeking opportunities for outsized outcomes that can complement a more conservative portfolio. And some take a disciplined, allocation-driven approach, treating venture capital as one part of a broader, diversified investment strategy over time.
These different perspectives highlight that there is no single reason to invest in venture capital. Investors often evolve in how they think about the asset class, and their motivations may shift over time. Understanding your own goals and approach is an important step in determining whether venture capital is the right fit for your portfolio.
As you begin exploring venture capital, we encourage you to review our glossary blog to get familiar with key language and terminology used in venture capital investing. Building this foundational understanding can support more informed decision-making and a more confident approach to the asset class.
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About Your Instructors
David Shapiro
Managing Partner, Blue Ivy VenturesDavid Shapiro serves as Managing Partner of Blue Ivy Ventures, bringing more than 25 years of experience as an investor, adviser, and board member, with expertise spanning both early- and late-stage venture. He previously served as Senior Vice President of Corporate Development and Business Development at DataXu and has additional experience across global venture and private equity.
Mike Collins
CEOMike Collins is an experienced operator across nearly every facet of venturing—from angel investing and venture capital to new business and product launches, as well as innovation consulting. He is a serial entrepreneur who has founded multiple companies, including one partially owned by WPP, and began his career at the venture capital firm TA Associates.
Alumni Ventures and its personnel provide investment advice only to affiliated venture capital funds. AV Academy is not personalized advice for any participant.
This communication is from Alumni Ventures, a for-profit venture capital company that is not affiliated with or endorsed by any school. It is not personalized advice, and AV only provides advice to its client funds. This communication is neither an offer to sell, nor a solicitation of an offer to purchase, any security. Such offers are made only pursuant to the formal offering documents for the fund(s) concerned, and describe significant risks and other material information that should be carefully considered before investing. For additional information, please see here. Achievement of investment objectives, including any amount of investment return, cannot be guaranteed. Co-investors are shown for illustrative purposes only, do not reflect all organizations with which AV co-invests, and do not necessarily indicate future co-investors. Example portfolio companies shown are not available to future investors, except potentially in the case of follow-on investments. Venture capital investing involves substantial risk, including risk of loss of all capital invested. Diversification cannot prevent investment loss; it is a strategy to mitigate investment risk. This communication includes forward-looking statements, generally consisting of any statement pertaining to any issue other than historical fact, including without limitation predictions, financial projections, the anticipated results of the execution of any plan or strategy, the expectation or belief of the speaker, or other events or circumstances to exist in the future. Forward-looking statements are not representations of actual fact, depend on certain assumptions that may not be realized, and are not guaranteed to occur. Any forward-looking statements included in this communication speak only as of the date of the communication. AV and its affiliates disclaim any obligation to update, amend, or alter such forward-looking statements, whether due to subsequent events, new information, or otherwise.