Venture Capital Model

The Venture Capital Model is the flagship fund forecast. Quarterly cash flows, multi-stage graduation tracking, fund-level statements, management company P&L, and three independent scenarios in one workbook.

Fund managers use this one. Founders don't.

Sheets

16 total: README, License, Get Started, Scenario 2 Get Started, Scenario 2 Forecast, Scenario 3 Get Started, Scenario 3 Forecast, Forecast, Key Reports, Scenarios, Statements, Management Company, Resources, Model Comparison, Glossary, Changelog.

Almost all input work happens on Get Started. Everything else is formula output, scenario copy, or reference.

Get Started: the one sheet you edit

Capital and Fund Assumptions (R5-R20)

Column D is every primary input. D9 and D10 are Total Committed Capital ($25M) and GP Commit %, treated as LP interest for carry. D11 is Organizational Expenses (one-time, first quarter) and D12 is Operational Expenses (annual, on top of mgmt fees). D13 is Management Fees % per year and D14 is Carry %. D15 and D16 are Preferred Return % and GP Catchup %, both defaulting to 0%. Preferred returns are uncommon for US venture; leave at zero unless you need the waterfall mechanics. D17 through D20 are the period inputs in quarters: new investment (16 = 4 years), mgmt fees (40 = 10 years), fund ops (46 = 11.5 years), and extension (6 = 1.5 years).

Recycling (R23-R31)

Set your recycling policy here. D27 target %, D28 basis (committed capital or mgmt fees), D29 window (exits within N quarters of investment), D30 cap (invested or proceeds per investment), D31 recycled-through-quarter.

Investment Strategy (R34-R70): the section that makes this model

Multi-stage graduation across up to six rounds, not just return tiers. This is what separates the VC Model from aggregate fund models.

R37 columns are New Investment, 2nd Round, 3rd, 4th, 5th, 6th, and Exit. Each input row runs across those columns:

• D39-I39. % Allocation of capital to entry at each stage (default 100% to New)
• D42-I42. Average invested per new investment ($750k)
• D44-I44. % that graduate to the next round. Defaults: 30%, 50%, 50%, 60%, 70%, 0%.
• D68-I68. Average Initial Investment per round
• D69-I69. Post-money valuation per round ($6M, $18M, $54M, $162M, $324M, $648M)
• D70-I70. Dilution from each round (0%, 20%, 20%, 20%, 20%, 20%)

Rows 45-66 calculate graduation, exit counts, and ownership tracking. All formulas. Change the inputs, not the outputs.

Portfolio Construction (R73-R95)

Per-round check size, reserves, follow-on amounts: formula rows driven by the Strategy section. R77 is # of checks (new + follow), R78 is total capital deployed. See portfolio construction.

Return Expectations (R98-R130)

All formula. Exit multiples per round, proceeds per investment, ownership at exit net of dilution, weighted holding period, return distribution.

Fund Performance (R133-R153)

All formula. Total / LP / GP splits where it matters. R137-R142 called/expenses/fees/recycled/invested/proceeds. R143 carry (with preferred return waterfall). R144 distributions. R146-R149 gross and net multiple, gross and net IRR. R151-R153 PIC, DPI, RVPI. See VC performance metrics.

Forecast

Quarterly cash flows, up to 46+ quarters. Each column is a quarter. Rows track capital calls, management fees, fund expenses, investment pacing (new + follow-on), exit proceeds (using holding periods from Strategy), distributions, NAV, and cumulative IRR. The J-curve is right there. Formula-only. Change assumptions on Get Started.

Statements and Management Company

Statements: fund-level Statement of Operations, Balance Sheet (investments at cost plus unrealized gains; carried interest payable on liabilities), Statement of Cash Flows. See fund statements.

Management Company: GP entity P&L. Fee revenue, operating expenses, GP commit obligations, carry income, net income to the GP. See management company.

Scenarios: how to run one

Three scenarios, each with an independent Get Started + Forecast pair.

1. Open Scenario 2 Get Started (or Scenario 3 Get Started).
2. Change whatever assumptions you want to flex: fund size, graduation rates, valuations, return tiers.
3. The matching Scenario 2 Forecast recalculates.
4. Scenarios compares all three side by side.

Keep the base case clean. Use scenarios for conservative / high, or for strategy-A vs strategy-B, not for scratch work.

Edit with AI

Every cell is open. Every formula is documented. Open the workbook with Claude for Excel, or connect the Hemrock MCP server at mcp.hemrock.com for primers, task prompts, and sanity checks. Grab the venture_fund primer from the prompt guide before the first edit.

Common moves: adjust graduation rates and re-read proceeds; add a seventh round stage; flip to American deal-by-deal carry; change recycling to a mgmt-fees basis.

Change inputs, not formulas. The Investment Strategy section (R34-R70) drives everything downstream. If a result looks wrong, fix the input, not the output row.