Harlem Capital hosted our first-ever AGM – a common acronym in finance. What is a VC’s annual general meeting? And why is it one of the most important events we’ll have all year?

Watch our recap video here:

What is an Annual Meeting?

A VC annual meeting is when VCs have a formal meeting with the investors in their funds, also called limited partners (LPs). It’s a time when VCs report back on their fund performance, diving into key portfolio updates, perspectives on the market, and the forward outlook for investing and their own fundraising. It’s similar to a quarterly report for a public company. We’ve done all our annual meetings via Zoom, but this year was our first in-person – hosted at AWS’ Loft in Soho, New York City.

What gets discussed?

It’s a wide range of topics, but will typically cover performance updates for each fund, key details on top-performing companies, internal strategy, and other unique insights.

Who is in attendance?

The firm’s LPs, sometimes other investors or supporters of the firm, and founders. There’s also a great mix of guest speakers depending on the size and scale of the event.

How is fund performance measured?

1. Gross and Net TVPI

Total Value to Paid-in Capital (TVPI): This measures the entire value of your investment — both realized (sold) and unrealized (not yet sold) — relative to the amount of money you gave to the fund.

2. Gross and Net IRR

IRR is classified in two ways: 1) Gross IRR refers to the annualized return generated or expected to be generated by a fund or portfolio investment 2) Net IRR refers to that return after the payment of fees.

Here are 5 lessons HCP shared with LPs during our annual meeting:

1) Prep for follow-on financing
We need to be very close during the fundraising process as we have more connections and data points. Many founders do not know what best-in-class metrics are (which change over time), so it’s important we set clear targets with them.

2) Utilize fractional revenue officers
The #1 issue we see with startups is sales. Getting top-of-funnel, conversion, and crafting a strong GTM strategy are integral to a company’s success. Founders have the raw materials but need someone to sit on sales calls, optimize the pitch and standardize the process.

3) Stay close to founders
Early-stage funders can no longer pass the baton to Series A leads. We talk monthly or quarterly with all our founders. Even non-board calls can provide invaluable insights to us and the founders in our portfolio. This level of rigor and consistency keeps founders accountable and motivated.

4) Lean into founder archetypes
After analyzing the 10,000+ deals we’ve seen, we came up with four distinct archetypes: 1) Hustler 2) Star 3) Veteran 4) Academic. Now that we’ve invested in 50+ companies we see the strengths and weaknesses of each archetype. This impacts how we do diligence and work with the founder post-investment.

5) Develop industry themes 
We remain a generalist fund, but we have found core industries that most align with our mission 1) Enterprise SaaS / AI 2) E-commerce Enablement 3) FinTech 4) Vertical SaaS. We are now largely focused on B2B and B2B2C now.

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