Good morning 👋
When I was investing into emerging managers on the LP side, there was a very small group of LPs who I looked to as tastemakers.
Cendana was one of those LPs.
They’ve quietly built up one of the most impressive fund of funds in the world, and now they have multiple strategies that run in parallel to their core fund investing.
They announced their Fund XI yesterday, and today we’re breaking down the announcement to decipher where their team sees the venture world heading.
Today’s highlights
How Cendana keeps winning
Find PMF or beg for approval
The new economic order
A new fund pops up to lure founders from school
TOP
Cendana’s latest fund ➡️
“If you want to find signal in seed investing, follow Cendana.”
I can’t remember who told me that, but it’s true.
Cendana is arguably the best in the world at identifying the next era of emerging managers, and they’ve been executing on that strategy for the past 15 years.
Yesterday, they announced their Fund XI.
Here are some thoughts on where they see the venture world heading:
Seed VC used to be considered a fad; now it is probably the most competitive stage of venture investing
The escalation of platform VCs raising larger and larger families of funds meant that their LPs started to lack the exposure to early-stage venture that they initially anticipated
Cendana sees the most opportunity partnering (early) with sub-$100m pre-seed and seed funds
Core commitments are ~$15m into managers with an average fund size of ~$55m
They also write “discovery” checks into smaller funds with the aim to be ~20% of the AUM
They also raised $200m for two separate managed accounts:
Secondaries: To buy up LP interests of other early-stage funds (and provide some DPI for existing managers)
Co-investments: To make direct investments into underlying portfolio companies from their funds
COMMUNITY
The OS for private investors 🕹
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Good background knowledge and an understanding of how venture dynamics work
A source of good deal flow so that you see founders first
An elite investor network that you can share notes, deals, and other information with
Mental frameworks to understand company building, scale, and what makes a good vs. great investment
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That’s why we built this.
2,500 other investors from places like Bessemer, Insight, Accel, and Founders Fund already use it, and we think you should too.
TWEET
HEADLINES
New $5M deep tech fund aims to lure founders from universities (TechCrunch)
Al Gore’s Just Climate fund raises $175M from Microsoft and CalSTRS for nature-based climate investments (TechCrunch)
As Coffee And Chocolate Prices Surge, Startups Scale Up Alternatives (Crunchbase)
Wiz’s $32B sale is another record—and a sign of new rapid-growth era (Pitchbook)
MEME
LINKS
🕳️ 3 Startup Finance Pitfalls….and How to Avoid Them: Know the 3 big numbers, use them, check them weekly, and then be honest with what you find
↪️ From Middlemen to Machines—The New Economic Order: AI is rewriting the rules of engagement and democratizing information used by centralized gatekeepers
🤖 The $350k Job That’s Replacing “Growth Hackers”: Marketing Ideas analyzed 30+ job postings for “marketing innovation” roles and discovered companies are terrified of missing the AI revolution and will pay/fight for those that are skilled
🌤️ Why You Need a Warmup: Not just athletes need a warmup but we could all use a bried extra rep before that next interview or presentation
🔋 The Elon Musk Anti-Stress Protocol: Jordan Belfort (yes, that Jordan Belfort) describes how Musk uses the 3 stages of stress response to release the pressure and recharge
Thanks for reading this far and giving us a little bit of your attention this week.
Feel free to unsubscribe whenever this stops becoming valuable to you.
- Clay
(Founder @ Confluence.VC | GP @ Outlaw)
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