"VC 101" talk at 500 Startups, July 21, 2011

1. VC 101: Inside the Black Box Christine Herron Intel Capital July 2011

2. (AKA: Christine’s Quick & Dirty Guide to Venture Capital)

3. What’s My Motivation?

4. What’s Under the Hood?

13. Money Going In: Capital Contributions 1% of total 99% of total GP GP GP GP GP GP GP GP LP LP LP LP LP LP LP

14. Money Coming Out: Profit Sharing 20% of total 80% of total GP GP GP GP GP GP GP GP LP LP LP LP LP LP LP

16. Staying in Business = Raising More Funds Year 1 Year 3-4 Each Fund Life = 10 Years 3-4 Yrs = Seed NewCos 6-7 Yrs = Harvest & Do Followons Must raise new funds to keep investing in NewCos; once new fund is raised, NewCo funding will come from it Fund III ($150M) Fund II ($125M) Fund I ($100M) After 6-7 years in business, VC will have 3+ concurrent, active funds at any one time; only one, however, will be funding NewCos Year 6-7