Franchise Funds: Metrics To Be Extraordinary with Jessica Archibald

Origins - Inside Venture Capital, Hosted by a GP and an LP

Jessica Archibald is a GP and member of the Investment Committee at Top Tier Capital Partners, where she is co lead of the funds team and participates extensively in the capital formation efforts of the firm. She and Beezer Clarkson, LP at Sapphire Partners, sit down for the next episode in this miniseries on franchise funds - what it takes to build one, and how some firms lose their franchise status. Jessica digs into Top Tier’s numbers to discuss the importance of getting reliable DPI in a set timeframe, why it’s often better to bet on consistent 3x or even 1x returns, and the importance of succession in building a franchise fund.

Learn more about Sapphire Partners: sapphireventures.com/sapphire-partners

Learn more about OpenLP: openlp.vc

Learn more about Asylum Ventures: asylum.vc

Learn more about Top Tier Capital Partners: ttcp.com

Subscribe to the OpenLP newsletter for a monthly roundup of the latest venture insights, including the newest Origins episodes, delivered straight to your inbox.

CHAPTERS:

0:00 Welcome to Origins

2:10 Jessica’s Time with Top Tier

4:08 Fund Graduation Rates

8:43 Who is a Franchise Fund Today?

13:21 ”Is There a DPI Number Somebody Has to Hit to Be Considered Extraordinary?”

17:10 Can You Become a Franchise Fund By Doing Secondaries?

25:08 The Range of Strategies in Franchise Funds

31:32 Maintaining Franchise Status

35:33 What Do Founders Want?

39:42 ”Are You a Franchise Fund If You Haven’t Had Some Level of Succession?”

48:02 End of Year Guidance For New Venture Funds