Fund Structure
Last updated
Quick Answer
A venture fund backed primarily or entirely by a single institutional investor, such as a corporation, university, or family office.
A captive fund has a single or dominant LP, unlike traditional VC funds that raise from many LPs. Corporate venture arms and university endowment-backed funds are common examples. Captive funds may have different incentives or strategic mandates than independent funds.
In Practice
Google Ventures (GV) is a captive fund backed entirely by Alphabet, giving it a permanent capital base but also strategic considerations that independent VCs don't have.
Why It Matters
Captive funds may have conflicts of interest or strategic agendas that affect their investment decisions. Founders should understand who's really behind the fund.
VC Beast Take
Captive funds play with house money, which changes everything — time horizons, risk appetite, and what 'success' looks like.
A captive fund has a single or dominant LP, unlike traditional VC funds that raise from many LPs. Corporate venture arms and university endowment-backed funds are common examples. Captive funds may have different incentives or strategic mandates than independent funds.
Understanding Captive Fund is critical for founders navigating the fundraising process. It directly impacts deal terms, valuation, and the relationship between founders and investors.
Captive Fund falls under the fund-structure category in venture capital. This area covers concepts related to how venture capital funds are organized, managed, and governed.
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