Strategy & Portfolio
Last updated
Quick Answer
The process by which VCs identify and access new investment opportunities.
Deal sourcing encompasses all the methods VCs use to discover and evaluate potential investments. Sources include proprietary network referrals, outbound prospecting, accelerator demo days, conferences, cold inbound from founders, and increasingly, data-driven identification using tools that track company signals. The quality of deal flow is often more important than volume — top firms see thousands of companies but invest in fewer than 1%.
In Practice
A seed fund's deal sourcing mix: 40% from founder/VC referrals, 25% from portfolio company intros, 20% from outbound research, 10% from accelerators, 5% from cold inbound.
Why It Matters
Proprietary deal flow is a key competitive advantage. Funds that see the best deals first and have the reputation to win them consistently outperform those competing in widely-shopped processes.
VC Beast Take
The industry is quietly bifurcating into 'hunter' and 'farmer' funds. While everyone talks about proprietary deal flow, the reality is that most top-tier deals still get shopped around. The real differentiator isn't finding unique deals — it's getting into the best deals when everyone else wants in. Smart GPs focus less on exclusive sourcing channels and more on building the reputation and value-add that makes founders choose them over competing term sheets.
Venture Capital KPIs: 20 Metrics Every GP Should Track
Most GPs are flying blind. Here are the 20 VC KPIs that separate disciplined fund managers from everyone else — with benchmarks, formulas, and why each one matters.
Why Emerging Fund Managers Are Ditching Spreadsheets in 2026
The spreadsheet era for fund management is ending. Here's why the smartest emerging GPs are moving to purpose-built platforms — and what they're gaining.
50+ Venture Capital Interview Questions by Role (With Sample Answers)
Preparing for a VC interview? Here are 50+ real questions organized by role — Analyst through GP — with sample answer frameworks from people who've been on both sides of the table.
Emerging Manager Playbook: Raising Your First Fund in 2026
The complete playbook for first-time fund managers. Legal formation, LP targeting, fundraising timeline, and the mistakes that kill first funds.
General Catalyst and First Round Capital: How Two Firms Are Building Tomorrow's VC Pipeline
General Catalyst's Venture Fellows and First Round's Angel Track take radically different approaches to training the next generation of venture investors. Both are working.
LP Data Room Best Practices: What to Include When Raising Your Fund
A practical guide for emerging managers on exactly what to include in an LP data room, how to structure it, which platforms to use, and the mistakes that quietly kill a fundraise.
Deal sourcing encompasses all the methods VCs use to discover and evaluate potential investments. Sources include proprietary network referrals, outbound prospecting, accelerator demo days, conferences, cold inbound from founders, and increasingly, data-driven identification using tools that track...
Understanding Deal Sourcing is critical for founders navigating the fundraising process. It directly impacts deal terms, valuation, and the relationship between founders and investors.
Deal Sourcing falls under the strategy category in venture capital. This area covers concepts related to the strategic approaches to portfolio construction and management.
Newsletter
Join thousands of founders and investors. Every Tuesday.
The VC Beast Brief
Master VC terminology
Get smarter about venture capital every week. Our newsletter breaks down the terms, concepts, and strategies that matter.
VentureKit
Ready to launch your fund?