Little exists in the trade or academic literature regarding double bottom line fund performance metrics for industry benchmarking or best practices. This became apparent when a fund client of mine asked how to measure themselves against other funds for the purposes of raising a second fund. I suggested performing a blinded fund study to provide some comparable metrics hoping for some financial return data, despite the early stage of most of these types of funds.
This study was conducted in March and April 2011 with responses received from eight funds, covering five Midwest states. One fund had portfolio level data enabling an extraction of data for the life sciences portion to create a quasi fund. Therefore, the total number of reported funds equals nine, which I labeled Fund A through Fund I. Vintage years vary across the spectrum with the earliest in 2002 and the latest in 2010. As one might expect, in this small a sample size, these funds come in various shapes and sizes, and no one fund is a good direct comparable to another. Some performance indicators and best practices can be gleaned from the data despite the inconsistencies between all the funds. There was a wide disparity in fund’s data collection indicating some standardized practices would be useful for making future comparisons. Given variability in the funds, cumulating all the data to arrive at averages is not meaningful, so each fund is described separately with general conclusions.
To read the full, original article click on this link: NASVF EXCLUSIVE FEATURE REPORT: Pre-Seed and Seed Funds Blinded Performance Comparable Study
Author: Karen E. Morgan
