Roger Ehrenberg recently launched his first venture capital fund, IA Ventures, with $50 million in commitments from investors. In a recent article published by BusinessInsider, he thanked his supporters and offered a glimpse into why he felt he was successful in making the transition from Wall Street trading executive to manager of a $50 million venture capital fund.
It was a six-year odyssey for him that was both nerve wracking and represented a step backwards financially (at least temporarily). So why was he successful in raising a $50 million, especially at a fairly challenging time for fundraising?
Ehrenberg first credits his investment experience. Prior to starting IA Ventures, he had been involved in the seeding or incubation of 40 companies in his targeted VC space, data-intensive businesses. Many of these angel portfolio companies had grown and become quite successful. So they served to demonstrate his investment acumen to potential investors.
Next, he was able to demonstrate leadership experience to investors. He’d run complex businesses and built high performance teams for more than 20 years. Not just as an angel investor, but also as a member of the board of directors for several successful companies.
Third, he honed the focus of his new fund into a razor-sharp pinpoint. Ehrenberg says many venture capitalists take more of a generalist approach for their funds, seeking the flexibility to invest in whatever changing market conditions dictate. But he credits his success to having a very sharply focused, differentiated theme: namely, tech firms solving Big Data problems. In his words, he “defined the sandbox” clearly for investors, and demonstrated that his team had experience working in and attracting great entrepreneurs to that sandbox.
You can read the five other keys that Ehrenberg says contributed to his success in his venture capital job at BusinessInsider. Meanwhile, what’s your opinion? What traits or factors must VCs demonstrate today to give that added level of confidence to potential investors? Add your comments below.
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