Venture Capital Firms
and Go-to-Market Strategy
(or Private Equity Firms)
Venture capital firms seek out or get sought out by early-stage companies that want to raise venture capital (VC) investments in exchange for an equity or ownership stake.
Once a venture capital firm invests in a startup, the VC’s team will typically advise the startup’s founder(s) and their team on many issues related to growth -- including go-to-market strategy.
Venture Capital Firms, General Partners (GP’s) vs. Limited Partners, and Where Capital Originates
General partners (GP’s) of venture capital funds come from an investment background. It's their job to locate high-growth potential startups while they negotiate with and agree to terms with startup founders. General partners have a fiduciary responsibility to their fund’s limited partners.
As individual or institutional investors, limited partners (LPs) invest their capital but don’t get involved in the day-to-day operations of the venture fund. The capital flowing into VC funds often originates from financial services firms, insurance companies, pension funds, and college endowments.
Where Venture Funding Ends Up
VCs most often invest in a relatively small number of industries, including computer hardware, healthcare, information technology and services, mobile, software, and telecommunications.
While only a small percentage of venture capital investments end up being runaway successes, VCs can claim credit for backing some amazingly disruptive, once-in-a-generation startups, including Airbnb, Alibaba, Facebook, GitHub, Google, Groupon, Qualtrix, Snowflake, Spotify, Twitter, Uber, Whatsapp, Workday, and Zoom.
Venture-Backed Startups by the Numbers
According to the National Venture Capital Association (NVCA), 4.4 million employees work for U.S venture-backed startups, representing 51% of global venture capital funding.
10,800 startups received venture funding from 1,965 venture capital firms with a little more than a half-billion dollars in assets under management (AUM).
Go-to-Market Strategy for the Portfolio Companies of VC Firms
VC partners look for startups that can grow to 100+ million dollar valuations. To achieve and exceed this milestone, VC general partners know their portfolio companies need a great product and a cost-effective way to get their target market to purchase that product; typically, they need a very solid value proposition. All of these building blocks roll up in the firm’s go-to-market strategy.
From a tactical perspective, venture capital firms advise their portfolio companies to create a go-to-market strategy that includes buyer personas, jobs to be done, a defined sales process, a demand generation plan, content strategy, key performance indicators (KPIs) to measure progress, and a customer success framework.
However, creating an effective go-to-market strategy can be extraordinarily time-consuming and expensive.
And that’s the reason why we created Go-to-Market Strategy Blueprints so that you can get instant access to affordable Go-to-Market Strategy Blueprints for specific industries and business models.