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Transparency and Online Startup Investing

By Alexander Mittal  •  Mar 4, 2015

From the outside, venture capital appears to be a relatively opaque asset class. After all, the best available VC fund performance benchmarks are very incomplete. Furthermore, the long time period required for a portfolio of startups to exit has the side effect of obscuring realized VC fund performance for many, many years.

Reality is more complex than this outward appearance. Rather than being a black box, some of the best offline VCs I know have made it a point to be transparent to their limited partner investors around the nature of their returns. These are the VC firms that have been in business across many years and funds, who have survived up markets and down markets, and who have built trust from their continued integrity.

Raising the bar online

As the world’s first and premier online venture capital platform, FundersClub has the unique opportunity to define the online startup investing industry’s best practices for investment returns transparency.

We’ve already begun by regularly reporting the unrealized net IRR a FundersClub member could achieve by diversifying equally across all FundersClub startup investment opportunities since inception.

Now, with the release of FundersClub’s new My Investments™ feature, FundersClub is the first and only online startup investing platform to offer robust financial reporting and portfolio analysis for your specific portfolio of investments.

Not only do investors deserve this significant upgrade above the black box that is currently an industry norm, but we believe that greater portfolio analysis and returns transparency will help investors make smarter investment decisions, and in turn, help them optimize for better returns.