Minisode: Franchise Funds: Grading Performance

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

Origins host Beezer Clarkson sits down with her colleague Laura Thompson, fellow LP and Partner at Sapphire Partners, to unpack her recent conversation with Jessica Archibald, a GP at Top Tier Capital. They discuss Jessica’s engineering-based analytical approach to answering the question “what makes a franchise?” and discuss some surprising things they learned - Jessica’s view that there’s only one real way to do succession, the importance of breaking good and bad news in a way that creates a performance culture, and whether or not they’re going to adopt Jessica’s policy of assigning letter grades to funds at Sapphire Partners.

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

Read Laura Thompson’s blog on why venture reserves aren’t always a good thing:

sapphireventures.com/blog/dirty-secret-venture-reserves-are-not-always-a-good-thing/

Read Laura Thompson’s blog on fund recycling:

sapphireventures.com/blog/fund-recycling-moves-the-needle-for-both-lps-and-gps-heres-how/

Read Laura Thompson’s blog on QSBS:

sapphireventures.com/blog/how-lps-gps-and-founders-can-leverage-qsbs-to-make-more-money/

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CHAPTERS:

(0:00) - Intro

(1:08) - Jessica Takes It In a Different Direction

(3:41) - Communicating with your LP base (So There Aren’t Surprises)

(7:15) - Franchise Funds Are Intentional

(9:44) - Getting to 1x DPI in Nine Years

(15:55) - 2x is the new 3x

(19:43) - Giving Funds Letter Grades