

Hedge funds are increasingly outbidding VCs on hot deals like Snapchat and Box - amitkumar01
http://techcrunch.com/2014/02/22/venture-investing-hedge-funds-rising/

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asanwal
Good article. A few additional things to note:

1\. Most founders don't have to think about hedge funds as a funding source.
They're not doing seed/early stage deals. There are 300-600 private companies
that hedge funds track and care about. It's later stage, pre-IPO companies.

2\. GGV Capital (article author) is a late stage investor so they may compete
with hedge funds, but more often than not, hedge funds are providing capital
that VCs cannot. Hedge funds are a much much larger asset class than VCs and
VC has been contracting. So when a VC-backed company needs big $$, VCs need to
syndicate and corporates and hedge funds are often jumping into these deals.

3\. This trend is going to increase. As private companies stay private longer,
hedge funds and public market investors in general are taking more interest in
the private company universe. And they look at private compnaies as investment
targets and as potential disruptors of their public company holdings.

4\. Hedge funds are a great deal more data-driven and analytical than their VC
cousins. VC is still very artisinal and instinct driven. It will be
interesting to see how their behavior and approaches influences VCs, if at
all, over time. (We sell data to hedge funds investing in private companies
and so see how they use data)

Notes:

1\. Hedge and mutual funds put $2.45 billion into private companies last year
- [http://www.cbinsights.com/blog/trends/hedge-mutualfund-
tech-...](http://www.cbinsights.com/blog/trends/hedge-mutualfund-tech-
investments)

2\. Corporates part of 4 of 10 largest tech financings -
[http://www.cbinsights.com/blog/trends/tech-corporate-
venture...](http://www.cbinsights.com/blog/trends/tech-corporate-venture-
capital-balance-sheet)

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erichocean
Since your company is providing the information, can you share more on how you
are deciding which 300-600 companies to track and care about?

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slurry
Maintaining a conceptual separation between "VC" and "hedge fund" is probably
unhelpful.

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seizethecheese
Why, exactly?

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scoofy
Venture capital could simply be a subset of what the hedge fund participates
in.

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Chronic26
Who cares. Nobody. That's why this thread is falling off the front page.

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saym
At what point did you think this comment contributed in any way?

