What Kind of VC Can Secure Funding from a Fund-of-Funds? After Reviewing 2,000 VCs, We Have the Answer
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What Kind of VC Can Secure Funding from a Fund-of-Funds? After Reviewing 2,000 VCs, We Have the Answer
Every type of manager has the right to win; the key lies in knowing what to look for.
Navigating Web3 tides with focused insightsAuthors: Moses Capital & Lev Leviev
Translated and edited by: TechFlow
TechFlow Intro: Moses Capital is a fund-of-funds (FoF) focused on early-stage venture capital. Over two years, it reviewed over 2,000 funds and invested in just 46—yielding a selection rate of 2.3%. This article recaps the four GP archetypes Moses Capital identified during its screening process, the specific reasons behind its 97% rejection rate, and an unexpectedly high-quality due diligence method that became its top source of deal flow. For readers interested in the VC ecosystem or the LP perspective, this piece is exceptionally information-dense.
When we founded Moses Capital, I thought I already had a decent grasp of the emerging fund manager landscape: a few hundred funds, clustered in familiar cities—just a matter of knowing where to look.
That assumption lasted about three months.
Over the past two years, we reviewed more than 2,000 funds for Fund I. We conducted 553 initial screening calls, completed full due diligence on 276 funds, and ultimately added 46 to our portfolio—a 2.3% acceptance rate. After sitting through so many conversations, patterns naturally emerged.
Here’s what we learned.
The Market Is Larger Than Anyone Imagined
Prior to building our systematic sourcing infrastructure, our deal flow resembled most FoFs’: driven by referrals and inbound inquiries. VCs referred other VCs. This logic works—but it also confines your view to “who knows you.”
Once we began real-time scraping of SEC filing data, the picture changed entirely. Dozens of new funds launch every week—many invisible to anyone’s radar for months afterward, by which time they’re already fundraising. By 2025, we covered roughly 95% of U.S. VC funds. The sheer volume of newly launched funds even surprised us.
The key insight? Most of these funds are invisible to the majority of LPs—not because they’re weak, but because they’re too early-stage and too small to have built the relationships required to land on anyone’s shortlist. That gap is precisely what we aim to fill.
Four GP Archetypes
After 553 initial screening calls, clear patterns emerged. We broadly categorize GPs we meet into four archetypes:
- Founder-turned-investor
A former founder or operating executive, typically with at least one notable exit, who decides to launch a fund. They hold credibility among founders and often possess strong deal flow within their niche. The challenge lies in the fact that running a fund and running a company are fundamentally different disciplines—portfolio construction, follow-on strategy, and post-investment management—many learn on the job. Some adapt quickly; others only truly mature by Fund II or Fund III.
- VC institution defector
A former partner or principal from an established fund (Tier I or Tier II), launching independently. They carry brand equity, demonstrable track records, and usually strong networks. Our primary focus: how much of that performance was truly theirs versus attributable to the platform? And once outside the large fund, do they retain competitive appeal among founders?
- Community-native GP
A type that surged notably after 2020—GPs who built reputation via community-building, writing, podcasts, and social media. They generate inbound deal flow, enjoy visibility, and often possess genuine community moats.
Within this group, there are actually two subtypes: one where the investor built the community first, using it to drive deal flow and create network value for portfolio companies; the other where a community operator, already immersed in natural deal flow, pivoted into investing. This distinction matters. For both, we assess two things: investment discipline itself, and whether the community can deliver tangible value to the founders they aim to back.
- The quiet technical expert
This is often my personal favorite archetype. The GP possesses deep technical or industry expertise in a specific domain, cultivated over many years. Founders consult them when facing problems—and over time, more and more founders want them on the cap table from day one—not for branding, but to help build the business from inception.
These individuals deliberately stay low-key; their reputation rests on deep subject-matter expertise and long-accumulated relationships. They almost never reach out to us proactively. We find them via systematic external search—or, more commonly, uncover them through founder references during due diligence on other funds. We ask every founder: “Who on your cap table has been most helpful?” The answer is often this type of GP.
What 97% Rejection Looks Like
We declined over 97% of the funds we reviewed. Each “pass” decision receives the same rigor as an investment decision—and this process has been continuously refined across every fund review.
- Roughly 30% of rejections relate to the GP or team: insufficient fund operations experience, lack of clear differentiation from existing players, or networks incapable of translating into unique deal-sourcing capability.
- Approximately 25% fail on portfolio construction: excessive late-stage exposure, undisciplined co-investment strategies, insufficient target ownership stakes, or over-diversification—which mathematically eliminates the possibility of power-law returns. If a fund isn’t designed to produce concentrated, outsized winners, it likely won’t.
- Around 20% stem from track record issues: too weak or insufficient investment history, or performance misaligned with current strategy (e.g., mismatched geography, sector, stage, or check size).
- Roughly 15% reflect strategy misalignment: the fund’s current strategy doesn’t match our thematic focus—irrespective of performance—such as being too large in scale, too broad in scope, or involving sectors or geographies we deliberately avoid.
- The remaining 10% fall under factors like fundraising dynamics. If a GP cannot raise capital, they cannot execute their strategy.
The Best Sourcing Channel We Never Planned For
Our sourcing evolved in stages. Initially, it relied on referrals and inbound inquiries. Then we built a systematic outbound engine, scraping real-time data on every newly formed U.S. fund and automatically filtering by size, strategy, and GP background. At peak efficiency, this channel generated 70% of our meetings—we engaged GPs before most LPs even knew those funds existed.
Yet the highest-value sourcing channel turned out not to be one we designed at all. It emerged organically from our due diligence process itself.
We conduct blind founder reference calls for each GP—if their track record permits, sometimes up to 10 calls. In these conversations, we don’t limit ourselves to the GP under evaluation. Instead, we open the founder’s cap table and walk through each early investor, asking for candid feedback. Names repeatedly cited become our next targets for proactive outreach.
This has proven to be our highest-quality source of deal flow.
Building Reputation
Moses Capital’s reputation initially spread through our investments and the relationships forged around them. Today, we receive numerous unsolicited GP inquiries—these GPs heard about us through the VC ecosystem. We strive to earn and uphold that trust.
We are not an anchor LP, do not sit on LPACs, and write modest checks. But we do our homework. Before speaking with a GP, we’ve typically tracked them for some time—monitoring their online activity, conducting references, forming independent judgments. Our questions are well-prepared. We understand fund economics. We avoid unnecessary interruptions. And if a fund isn’t right for us, we say so directly—and explain why.
GPs appreciate this transparency—and in turn, refer other GPs to us.
Two Years Later: What We’ve Learned
Two years. Two thousand funds. We now hold a deeper understanding of this market—and the people behind it. Every GP archetype has the right to win; the key lies in knowing what to look for. This remains an ongoing learning process—one powered by our ability to observe a sufficiently wide funnel and our continually refined, dynamic sourcing mechanisms.
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