How to find new LP investors for your fund at scale (+ list of top 46 LPs in German VC funds)
DDVC #39: Where venture capital and data intersect. Every week.
šĀ Hi, Iām Andre and welcome to my weekly newsletter, Data-driven VC. Every Thursday I cover hands-on insights into data-driven innovation in venture capital and connect the dots between the latest research, reviews of novel tools and datasets, deep dives into various VC tech stacks, interviews with experts, and the implications for all stakeholders. Follow along to understand how data-driven approaches change the game, why it matters, and what it means for you.
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Avid readers of this newsletter know that in the past I focused most of my attention on the sourcing, screening, and portfolio value creation parts of the value chain - just like most other Data-driven VCs out there (check out the āData-driven VC Landscape 2023ā report here to understand more about the leading firms and their focus). Yet, data-driven innovation does not stop here but gradually changes the remaining parts of the value chain too.
Today, Iām incredibly excited to have Arnas BrƤutigam share how his team leverages public register entries to identify potential LP investors for fund managers. He does not only explain his approach in full detail but also reveals the final result, his secret list of the top 46 most active LPs in German VC funds.
Arnas is a co-founder of startupdetector (a data provider for the German startup and investor ecosystem) andĀ AddedVal.io (a platform connecting 1,000+ business angels with suitable pre-seed / seed startups in Germany). Thank you for sharing your valuable insights below, Arnas! šš»
Raising a venture capital fund is hard. Well, not that I would know anything about it personally, having neither worked in VC let alone raised a fund myself. But at least, thatās what I hear a lot.
Before you finish your thought āWell, why is this guy then talking about fundraising for VCs?ā - let me explain.
startupdetector is a specialist in German commercial register data. Initially, we only provided data on newly incorporated startups (hence the name), but later expanded into startup investors and very recently into fund investor data.
As part of this push, we identified more than 3,800 LPs from more than 320 German VC funds which we compiled into a top 46 list of the most active LPs in Germany (full list at the end of this article - but donāt scroll down, yet!).
In this guest post, I will reveal the exact process that we used for you to replicate and apply across public registers. Strap in.
Two ways of leveraging commercial register data for VC fundraising
There are two distinct approaches for finding LPs for your fund through public data from the company register, direct and indirect.
1) Direct: āStealingā LPs from your competitor funds
This approach is based on the assumption that anyone who invested in a VC fund, might do so again with your fund.
Thankfully, the German commercial register makes it easy to find out who those LPs are. This is because every LP in a German GmbH & Co. KG (the legal form of choice for German VCs) is meticulously listed there.
In order to find your future LP candidates, all you need is the name of the fund you want to āstealā them from. Letās take ā468 Capital GmbH & Co. KGā for example.
Step 1) Search for the fundās exact name on www.handelsregister.de
Step 2) Click āCDā to download a PDF or āSIā for an XML file.
VoilĆ , you receive the full list of this fundās 60+ LPs - ranging from individuals and angel holdings to German and international family offices.
Aiming for a comprehensive cross-fund list, we obviously did not want to manually copy & paste all the LP names from the PDFs. So we opted for automatically downloading the XML files with a script.Ā
Next, we needed to know which VCs to actually look at.Ā Searching our startupdetector database, we identified more than 320 German VCs that are structured as a GmbH & Co. KG - both current and older vintages - and fed them into our script. Even strictly adhering to the official download limit of max. 1 XML file per minute, this did not take very long (well, if you agree that <6 hours is not long).
The result? A list of slightly over 6,000 LP <> VC Fund tuples. Hereof, we did some extensive manual data cleaning. I will spare you the details. Suffice it to say that it is surprising, how in a system run by notaries and an official register, spelling mistakes/differences are still quite normal. So this step took a while and was not the most exciting task..
Based on the cleaned dataset of tuples, we created a pivot table to reveal which LPs are the most active ones in German VC funds. Hereof, we assembled the 46 LPs with 7 or more German fund investments (results at the end of the article below).
