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Non-Tech : Venture Capital Stocks in Individual Investor -- Ignore unavailable to you. Want to Upgrade?

To: John Arnopp who wrote (33)	1/8/1998 10:26:00 AM
From: Bryan Steffen	Read Replies (1) \| Respond to of 49

John - I work for a VC firm. The most important thing one should do in considering investments with a VC firm is your feelings about the management. The Mgmt will make or break the fund. Find out what their track record is with venture investing. Ask for both sucesses and failures. Also remember that in a typical VC fund setting, the mgmt group will take 20% of the returns and distribute 80% of the returns back to the original investors. Plus depending on how they structure this fund, there might be an associated mgmt fee paid to them every year. just some quick thoughts, Bry

To: John Arnopp who wrote (33)	1/15/1998 7:39:00 PM
From: Jody Sherman	Read Replies (1) \| Respond to of 49

If you look at the prospectus, you'll see that the management of this company does not get their 80/20 split until they have returned full capital to the investor. Prior to that, they get 2% and up to 2% for O&O (organization and operations). The O&O charge is a first-year charge that is to help them with the fund-raising effort. After that, you should expect to see a 2% per year management until they return the $100M. If you think about it, what real VC firm (and from their web site it appears that they have been in business since 1979) could survive on just 2%. Their incentives are completely aligned with their investors. They have to work hard to find companies that can return that $100M as quickly as possible so that they can then begin to collect their 20%, which is why VC's do this in the first place. It seems like a company with a decent track record (I did a search on Technology Funding and also found www.technologyfunding.com, which has their portfolio performance and lists the companies they have previously invested in), some good deals, some average deals, some not so good deals -- like all VC firm's expect. that site has a lot of information that should make it easier for an investor to make a decision about this fund. I wonder why they aren't linked.