Venture Capital: 7 Proven Strategies to Break Into VC and Build a $100M Fund

Venture capital separates professionals who understand pattern recognition from those who rely on intuition alone, and according to TechNexus VP Caitlin Doyle, the gap is entirely closable.

Ryan Miller BSc., MFin. | Host, Making Billions Podcast | LinkedIn

Key Takeaways

• Understand that venture capital success is built on two foundational skills, deal sourcing through relationships and deal selection through pattern recognition, and that both are learnable with deliberate practice.
• Discover why venture capital portfolio diversification is the most overlooked discipline among early-stage investors, and how ego-driven check-writing produces the largest losses in a fund.
• Learn how to identify venture capital deal breakers before writing a check, including dead equity on the cap table and undisclosed background issues with founders.
• Explore why venture capital term sheet literacy, covering preferred shares, participation rights, and anti-dilution provisions, is essential for both investors and founders before signing any agreement.
• Consider how venture capital storytelling across the LP and entrepreneur relationship creates the strategic alignment that separates top-performing funds from the rest of the market.

Venture Capital Starts With Two Skills Every Aspiring Investor Must Build

Venture capital rewards those who master two core disciplines before anything else, according to Caitlin Doyle, VP at TechNexus, a $100 million venture capital fund that raises capital from institutional investors and deploys it into early-stage companies. In this episode of Making Billions Podcast, Doyle breaks down the entry path for aspiring venture capital investors with a clarity that removes the mystique many associate with the asset class. The two skills she identifies are sourcing deals and picking deals, and she is direct about the fact that neither arrives without deliberate work.

On the venture capital sourcing side, Doyle explains that relationships are the mechanism. It is not enough to know people. The key question is whether those people want to pull you into deals and whether entrepreneurs want you on their cap table.

Venture capital sourcing is built on trust demonstrated over time, consistency in showing up, and proof that you add value after the check clears. On the venture capital analysis side, Doyle points to pattern recognition as the core competency. Pattern recognition requires volume, seeing enough companies to understand where they are likely to fail and where they are likely to succeed.

For those without capital to invest yet, she recommends tracking companies on platforms like Crunchbase and PitchBook, reviewing top venture capital portfolios, and logging which investments would have been made and why, then tracking outcomes over five years. This approach builds the analytical foundation that separates disciplined venture capital investors from those making guesses.

Venture Capital Portfolio Diversification Is the Rule Most Investors Break

Venture capital textbooks are consistent on one point: diversification across a portfolio increases the probability that returns will meet or exceed market performance. Doyle is equally consistent in observing that the gap between knowing this principle and actually executing it is where most venture capital investors get hurt. The culprit, in her view, is ego.

In this episode, Doyle describes how venture capital investors stray from their thesis by chasing oversubscribed rounds, following high-profile co-investors, or simply falling in love with a deal. The behavioral outcome is predictable: check sizes double, entry prices rise above any defensible valuation, and the investment that felt exciting becomes the fund’s biggest loser. Venture capital discipline means following the rules you set for yourself, not the rules the market pressure of a hot round creates around you.

Doyle references a Carta report from Q1 2024 tracking fund vintages from 2017 through 2022 across both TVPI and DPI metrics as an illustration of this principle at scale. Funds from the 2021 vintage, a period defined by elevated valuations and aggressive fundraising, are broadly underperforming. The research, as Doyle describes it, does not indict those venture capital managers for lack of skill or weak sourcing.

It points directly at entry price as the variable that determines whether a fund can generate returns at all. Venture capital is a discipline of entry, not just selection. According to the SEC’s investor education resources, understanding valuation risk is a foundational element of any investment process.

Venture Capital Deal Breakers That Signal When to Walk Away

Venture capital due diligence is not complete until specific structural and integrity risks have been evaluated, and Doyle identifies two non-negotiable venture capital deal breakers that she applies consistently across every opportunity she reviews. The first is dead equity on the cap table, equity held by individuals who are no longer actively contributing to the company. In venture capital, this problem appears most often as a departed co-founder still holding a significant ownership stake or an early investor whose fund has closed or changed direction.

Doyle provides a clear venture capital threshold for evaluating this risk. At the Series A stage, any inactive party holding more than 10 percent equity is a structural problem. At Series B and C, that threshold tightens to approximately 5 percent.

If those numbers are present, her venture capital approach requires a recapitalization of the cap table before she will proceed. Dead equity creates misaligned incentives, complicates future financing rounds, and often signals governance issues that compound over time.

The second venture capital deal breaker Doyle describes is an undisclosed background issue with the founder. At a prior firm, she ran background checks on every entrepreneur before writing a check and informed them of this practice in advance. In two separate instances, issues emerged that had not been disclosed: one involving a prior criminal record, another involving a real estate license that had been revoked in multiple states for undisclosed behavior.

Venture capital is a long-term relationship, Doyle notes, often spanning five to ten years or more. What she identifies as the actual deal breaker is not the background issue itself, but the failure to disclose it. Harvard Business Review has examined why rigorous due diligence processes protect investors from costly relationship failures in private markets.

Venture Capital Term Sheet Literacy Is Non-Negotiable for Investors and Founders

Venture capital financing documents contain terms that directly control who benefits from an exit, who loses in a down round, and who holds real power over the business. Doyle describes venture capital term sheet literacy as a skill that every venture capital professional and every founder must develop, and she is explicit that this does not require a law degree. It requires the discipline to read everything, look up what you do not understand, and ask questions before signing.

The venture capital terms Doyle identifies as most frequently misunderstood or ignored include the distinction between common and preferred shares, participation rights, and anti-dilution provisions. On participation rights, she explains that this clause allows investors to receive their liquidation preference and then also participate in the conversion to common equity, effectively receiving a higher share of exit proceeds than the basic preference would suggest. For founders who do not understand this venture capital term before agreeing to it, the practical outcome is that exit proceeds they expected to receive flow to investors instead.

Ryan Miller references the well-known example of a founder who sold her company for a significant sum and received nearly nothing because participation rights allowed investor groups to claim both their guaranteed return and a portion of her equity’s value. On anti-dilution, Doyle points to the full ratchet provision as a venture capital term that can fundamentally restructure a cap table in a down round. A full ratchet reprices all prior preferred shareholders to the new lower price per share, heavily diluting founders and common shareholders in a moment of already painful circumstances.

Doyle’s standing instruction to her team reflects a core venture capital operating principle: she is not a lawyer and will never claim to be, but she knows enough to recognize when legal counsel needs to be brought in. Investopedia provides a detailed breakdown of how full ratchet anti-dilution provisions function across venture capital financing structures.

Venture Capital Market Conditions Reward Disciplined Investors Who Stay Active

Venture capital activity in the current environment reflects a market that has not yet fully resolved the dislocation created by the 2021 valuation cycle, according to Doyle’s assessment in this episode. LPs remain conservative, particularly those who backed venture capital funds that deployed capital quickly in 2020 and 2021 and are now back in market with returns that, while present, do not reflect the multiples LPs expected. That conservative posture is flowing downstream to entrepreneurs, who are increasingly raising bridge rounds, extending runway, and using SAFE notes and convertible instruments to reach the next milestone without triggering a down round.

The exit environment compounds this challenge for venture capital fund managers. Venture capital fund managers face a public market that has been largely closed for new listings, while private acquisition activity from corporate buyers has also slowed as those institutions manage their own capital conservatively. Doyle describes the current venture capital moment as a wait-and-see period, with many investors holding back to observe how macroeconomic conditions and the interest rate environment evolve.

Her view of this environment is not pessimistic from a venture capital strategy standpoint. Investors who remain active and disciplined in this market hold a pricing advantage that did not exist in 2021. Entry valuations are more rational, due diligence receives more weight, and the best venture capital deals are still being completed by managers who are committed to their sourcing and analysis processes. Bloomberg’s analysis of the venture capital market has similarly noted that periods of dislocation create durable return opportunities for managers who maintain deployment discipline.

Venture Capital Sector Themes Emerging Around AI and Clean Technology

Venture capital investment themes that Doyle identifies as carrying long-term significance include artificial intelligence and clean energy, with the important qualification that timing these sectors requires humility rather than conviction. On AI, she is clear that the technology is going to change how businesses operate, but the timeline for broad corporate adoption remains uncertain, particularly as institutions work through the infrastructure requirements and the organizational changes that AI deployment demands. Venture capital investors who approach AI with consistency rather than attempts to time the market are, in her view, better positioned than those making concentrated bets on immediate adoption curves.

On clean technology, Doyle frames the venture capital opportunity as carrying both financial and structural urgency. TechNexus invests across electrification, mobility, and climate solutions as areas where innovation is being driven by a combination of regulatory pressure, corporate necessity, and genuine market demand. Europe and Canada are ahead of the United States on policy frameworks that push large institutions toward clean technology adoption, but Doyle anticipates that regulatory carrots and sticks in the US will accelerate the cycle.

Venture capital investment in this space is, in her framing, both a return-seeking activity and a generational obligation. Ryan Miller adds to this theme by noting that clean energy represents a capital absorption challenge as much as an innovation opportunity. Large institutions including major asset managers are actively seeking deals in this space and face their own difficulty deploying capital at scale. The Wall Street Journal has covered the expanding role of venture capital in funding the energy transition across both early-stage and growth-stage companies.

Venture Capital Unfair Advantages That Separate the Top Investors From Everyone Else

Venture capital is learnable, and according to Doyle, this is the most important corrective to the belief that the asset class is accessible only to those with banking backgrounds or elite institutional pedigrees. She describes venture capital as an apprenticeship business and argues that the most effective path to competence is proximity to experienced investors who are willing to share what they know, including the mistakes they have made. Getting into deals without leading them, building financial models, and sitting in rooms where deal discussions happen are the experiences that build venture capital judgment faster than any classroom equivalent.

The second venture capital advantage Doyle identifies is storytelling. Venture capital fund managers sit at the intersection of LP capital and entrepreneur ambition, and the ones who perform consistently are those who can articulate a clear and compelling narrative that explains why LPs should invest in the fund and why entrepreneurs should want that fund on their cap table. She uses TechNexus as an example: corporate LPs invest because TechNexus bridges the language gap between large institutions and innovative startups, and entrepreneurs accept the investment because TechNexus brings strategic corporate partners who can accelerate their growth.

The third venture capital advantage Doyle describes is the simplest and the most frequently overlooked: being a good person. Venture capital is a relationship business with a long institutional memory. Founders and investors talk, and ghosting entrepreneurs after introductory calls, failing to send a basic email declining to proceed, or treating deal-sourcing contacts as transactional damages reputation in ways that venture capital professionals rarely recover from. Doyle requires her team to send a response to every entrepreneur they speak with, even when the answer is no. Forbes has noted that reputation management is one of the most underestimated competitive advantages in private markets.

For Fund Managers Raising $10M to $500M+

The Room You Have Been Trying to Get Into

The fund managers closing institutional capital are not smarter than you. They are better connected. Fund Raise Capital works exclusively with alternative asset managers who are serious about building a repeatable capital raising system — not guessing their way through LP conversations or hoping referrals materialize.

Fund Raise Capital is an exclusive community of fund managers — from $1M to $500M AUM — built around one goal: closing the gap between where you are and where your raise needs to be. Members share the exact frameworks, LP relationships, and operational infrastructure used by managers who are actively closing institutional capital today. This is not a course. This is not a mastermind. This is a working community built to differentiate your raise and compress your timeline to close.

Ryan Miller BSc., MFin.
Host, Making Billions Podcast
Founder, Fund Raise Capital
Built for fund managers and capital raisers working in the $10M to $500M+ range.

Book Your Strategy Call →

About the Guest

Caitlin Doyle is the VP at TechNexus, a $100 million venture fund that raises capital from institutional investors and works with them to develop investment strategies aligned with their internal mandates. Throughout her career, she has raised over $80 million and has spoken at South by Southwest, bringing her expertise in deal sourcing, underwriting, and venture capital portfolio construction to audiences across the industry.

Caitlin can be reached by email at caitlin@technexus.com and found on LinkedIn as well as on X at @CaitlinHDoyle. TechNexus can be explored further at technexus.com and followed on LinkedIn and X at @TechNexus.

Topics Covered in This Article

• Venture capital sourcing strategies built on relationships and reputation
• Venture capital pattern recognition and how to develop it without capital to deploy
• Portfolio diversification principles for venture capital fund managers
• How ego-driven investment decisions produce the largest venture capital losses
• Venture capital deal breakers including dead equity and founder background checks
• Term sheet literacy for venture capital investors covering preferred shares, participation rights, and anti-dilution provisions
• Current venture capital market conditions and the opportunity for disciplined investors
• Venture capital sector themes in artificial intelligence and clean technology
• Storytelling as a venture capital competitive advantage across LP and entrepreneur relationships
• Reputation and professional conduct as a long-term venture capital advantage

Venture Capital Fundraising as a Long-Term Relationship Between Fund Managers and LPs

Venture capital fund managers who raise institutional capital successfully are, according to Doyle in this episode, doing something more than presenting returns. They are building a case for why their relationship with a specific LP creates strategic value that neither party could access independently. TechNexus structures its LP relationships around corporate partners who need to understand innovation markets and startups that need access to corporate distribution. The venture capital pitch, in this framing, is a story about mutual benefit rather than a performance projection.

Doyle notes that the most common failure she observes among emerging venture capital managers is treating LP conversations as one-directional, presenting the fund thesis and waiting for capital to follow. The LPs who write checks into a venture capital fund are making a long-duration decision, often with capital tied up for ten years or more. That decision requires a level of trust that a single pitch meeting cannot produce, and the fund managers who understand this invest accordingly in follow-up, consistency, and transparency over time.

The practical implication for emerging venture capital managers is that LP relationship building must start well before a formal fundraise. Doyle’s approach at TechNexus reflects a model where corporate LPs are brought into the investment thesis at the strategy development stage rather than approached cold when a fund close is imminent. According to the SEC’s guidance on raising capital from institutional investors, maintaining consistent and transparent communication with prospective investors is both a regulatory expectation and a foundational relationship management principle for fund managers.

Venture Capital Career Development Through the Apprenticeship Model

Venture capital is not a credential business in the way that investment banking or public equity management can be, and according to Doyle in this episode, that is precisely what makes the career path both accessible and misunderstood. The fastest way to develop venture capital judgment is proximity to experienced investors who are actively making decisions, not proximity to academic frameworks or certification programs. Getting into the room where deals are discussed, even in an analytical support capacity, produces the kind of learning compression that no course can replicate.

Doyle describes her own development in venture capital as a function of being around experienced deal makers who were willing to explain not only what they decided but why, and more importantly, what they were wrong about. She emphasizes that hearing experienced venture capital investors narrate their own mistakes is one of the highest-use learning inputs available to someone entering the field. The ego required to pretend mistakes do not happen is the same ego that produces the deal discipline failures she described earlier in the conversation with Ryan Miller.

For those without a direct apprenticeship path into an established venture capital firm, Doyle points to angel groups, scout programs, and accelerator networks as structured entry points that provide both deal exposure and proximity to experienced evaluators. These environments allow aspiring venture capital investors to participate in screening, reference calls, and post-investment support in ways that build the foundational competency required before leading a deal independently. Harvard Business Review has examined the apprenticeship dynamics within venture capital and confirmed that relationship-based entry remains the dominant career pathway for those who build durable positions in the asset class.

Venture Capital Value Creation After the Check Is Written

Venture capital investors who treat the closing of a deal as the conclusion of their work are, according to Doyle, misunderstanding what the asset class actually rewards. The post-investment period is where the sourcing reputation that Doyle described earlier in this episode is either built or destroyed. Founders and investors talk, and the venture capital fund manager who shows up consistently after the check clears will receive deal flow from that network that no amount of cold outreach could generate.

In this episode, Doyle outlines the types of post-investment support that venture capital fund managers can realistically provide, and she is careful to distinguish between genuine value creation and performative involvement. Introductions to customers, connections to follow-on investors, and strategic input on fundraising narrative are meaningful contributions. Sitting on boards without the expertise or bandwidth to contribute is not, and it consumes founder attention in ways that actively harm the company.

Venture capital value creation requires honesty about what a manager can and cannot deliver. TechNexus’s model, as Doyle describes it in this episode, is built around the corporate LP network as the primary post-investment value mechanism. When a portfolio company needs a distribution channel, a pilot customer, or a strategic partnership conversation that a corporate investor could facilitate, TechNexus can connect those dots in a way that a generalist venture capital fund cannot. According to Forbes analysis of portfolio company performance, venture capital investors who actively support companies post-investment demonstrate measurably higher rates of follow-on participation from co-investors and LPs in subsequent funds.

Venture Capital Strategy for Emerging Managers Building Their First Fund

Venture capital fund formation for a first-time manager is, according to the frameworks Doyle shares throughout this episode, a sequencing problem as much as a capital problem. The order in which a manager builds credibility, through deal co-investment, advisory involvement, or angel participation, determines whether the eventual fund story is believable to institutional LPs or requires those LPs to take an uncomfortable leap of faith. Building a track record before building a fund launch structure is the pathway Doyle implicitly endorses through the career advice she delivers in this conversation.

The venture capital fund thesis must be specific enough to differentiate the manager from the hundreds of other funds pursuing capital from the same LP universe, and Doyle’s own example at TechNexus demonstrates how specificity creates competitive advantage. TechNexus is not a generalist venture capital fund. It is a fund that solves a specific problem for corporate LPs who need a structured way to access and assess early-stage innovation. That specificity makes the fund easier to explain, easier to remember, and easier for LPs to justify internally.

Doyle’s advice to emerging venture capital managers also reflects a realistic view of the current fundraising environment. LP budgets for new manager relationships have contracted, and the bar for a first-time fund has risen considerably since the 2021 cycle. Managers who enter this market with a clear thesis, a demonstrable early track record, and a coherent story about why their venture capital fund solves a problem that existing managers cannot are the ones who are closing commitments in the current environment. Bloomberg has reported that LP appetite for emerging venture capital managers remains selective but active, with institutional allocators specifically seeking differentiated strategies rather than replicating existing exposure in their alternative assets portfolios.

For Fund Managers Raising $10M to $500M+

The Room You Have Been Trying to Get Into

The fund managers closing institutional LPs are not smarter than you. They are better positioned. Fund Raise Capital works exclusively with alternative asset managers who are serious about building a capital raising machine — not guessing their way through LP conversations.

This is not a course. This is not a community. This is direct access to the frameworks, relationships, and infrastructure used by fund managers operating at the highest levels of the alternative asset industry.

Ryan Miller BSc., MFin.
Host, Making Billions Podcast
Founder, Fund Raise Capital
Built for fund managers and capital raisers working in the $10M to $500M+ range.

Book Your Strategy Call →

About the Guest

Caitlin Doyle is the VP at TechNexus, a $100 million venture fund that raises capital from institutional investors and works with them to develop investment strategies aligned with their internal mandates. Throughout her career, she has raised over $80 million and has spoken at South by Southwest, bringing her expertise in deal sourcing, underwriting, and venture capital portfolio construction to audiences across the industry.

Caitlin can be reached by email at caitlin@technexus.com and on X at @CaitlinHDoyle. TechNexus can be explored further at technexus.com and followed on LinkedIn and X at @TechNexus.