Our data has shown that 10% of the companies yield about 80% of the returns.

And because of that, if you become way too big, what ends up happening is the size of your

fund determines how much you invest in the company and not how much the company needs.

It also causes you to kind of push up your prices because you got so much money to deploy,

but you can only do so many investments. And then the likelihood of you getting that elephant return goes down.

The best funds, the most important factor is, you VCs are kind of guessing what the customer

wants and waste a lot at entrepreneur time, sending them on wild goose chases,

talking to guys who will never buy from them in a million years.

So what we've done is we've actually reversed it.

We said to the big corporates, what are you looking for?

Do you really have an intention of buying?

Do you have a budget?

And do you have a history of working with startups?

So today, one out of every eight

introductions we make turns into a deal. At the end of the day, the great venture funds are the ones

who are magnets for great entrepreneurs. So do you remember, like, what was the pricing like then in

2002, 2003? Oh, we were buying stuff for 70, 80% discounts.

So how did you raise the fund?

The lesson that I learned when you're starting a fund from zero, you should basically...

Welcome to the Peel, where we explore the world's greatest startup stories.

I'm your host, Turner Novak, founder of Banana Capital, venture capital firm that's a magnet for great

entrepreneurs. I'm excited for this conversation with Alan Feld, founder and managing partner of

...