Keeping Score in Silicon Valley
Forbes began ranking tech investors shortly after tech investing became cool. As with any startup, the turn-of-the-century Midas List was a trial-and-error grab bag, with lawyers and bankers mixed in among the Sand Hill Road crowd. In 2010, Forbes even suspended the list for a year to take stock. Like many of the firms we cover, we emerged stronger with a rigorous methodology, a torrent of data and a great partner (TrueBridge) to help crunch it.
Our model prioritizes bigger, bolder bets, which we believe embodies the Forbes worldview and the “Midas touch.” Investors get credit only for deals with subsequent raises (at a valuation of at least $400 million) or exits ($200 million-plus), where they show solid or better returns (sometimes way better, like Steve Anderson’s 700x score on Instagram). No more than two partners in a firm can share apportioned credit for deals. And to combat stagnation, deals discount slowly over five years before falling off the list entirely (sorry, Google and Facebook backers).
“Every year, as we get more data, the bar keeps getting higher,” says Forbes’ Alex Konrad, who oversees the Midas List. “Forbes stands as the gold standard in venture capital.”
Keeping score means something different this year, however. The #MeToo movement has put the most attention on the entertainment and media fields, but no two industries need to reform themselves more urgently than venture capital and tech, the twin towers of bro-dom.
Fewer than 10% of venture capital partners are women, and only 15% of startups funded in 2017 were founded by women. Those two statistics aren’t coincidental. Which makes our cover story on Silicon Valley’s allwoman All Raise group particularly potent.
It started with a tip to Konrad from Spark Capital general partner Megan Quinn that something was afoot. Konrad and co-writer Biz Carson were there from the beginning, as an industry’s women leaders moved to change their field from the inside, with a focus on tangible results. “In all of the hours of conversations we had with the group, there wasn’t a rallying cry to destroy the patriarchy or talk of how men had put the women down,” Carson says. “There was camaraderie, not competition.”
“It felt like history was playing out before our eyes,” adds Konrad, who notes that he was often the only man in a room of up to 100 power brokers. To which Carson replies: “Welcome to how women feel!”
For a glimpse into tech’s brighter future, see page 74.
—randall lane, ChieF Content oFFiCer
Konrad and Carson