Startup founder, looking to raise investor capital? Working on your pitch deck? Building out your data room? Currently in one of our Investor Readiness programs? This one is for you.
In recent weeks, we have worked with 400+ founders from pre-seed to Series B. A question that everyone asks; “What do we need for fundraising materials?”. Our answer: it depends, but probably more than you think. In this article we explore the current market expectations for founders going to market to raise capital.
Before we start….
Not every startup founder should raise outside investor capital. In fact, most probably should not. Bootstrapping, growing through revenue, is a perfectly good strategy. In fact, this can lead to a far better outcome for many founders than taking on outside investors, with dilutive financing and liquidation preferences stacked on each other and more.
Today, using a wide range of AI tools, we see more and more founder hit breakout revenue just bootstrapped, but for many founders, outside financing is still needed.
An exception to every rule
While most founders need to spend significant amounts of time on fundraising materials, fact is that some can skip it entirely. If you have an extreme outlier team, ARR velocity or any other factor that puts you in that top 1% – 2% bracket; most likely, investors will come to you, throwing term sheets at you faster than you can reject them. For these, exceptionally few, founders, fact is, you don’t have to make, build or prepare anything. Other, of course, than hitting $100M ARR in your first 18 months, and having a team of five people that just left Anthropic.
For the rest of us, here’s the checklist.
Choose your level, choose your materials
We identify eight levels of ‘startup founder maturity’. For some founders, thanks to unique team and breakout traction, level 1 might be sufficient, but in our experience, it pays off to work through all levels, with a goal to complete level 8, our most advanced maturity level, with all six decks, all materials and a full data room to boost.
Which level you choose to go for, is, of course, entirely up to you.
1. Strategic Memo
Want to do this quick and different? Got the confidence to fundraise ‘differently’? Follow Mistral’s Strategic Memo. When French AI startup Mistral raised a solid €105m pre-seed round with no product, four weeks after launching and just days after hiring its first employees, the startup world took attention.
For some founders, maybe a Strategic Memo is the right way to go?
Mistral’s 7-page Strategic Memo and the €105M round that followed.
2. Pitch deck
For most founders, including 1000’s of accelerators, incubators and startup hubs, ‘The Pitch deck’ is a must for anyone looking to raise capital.
But, did you know, there are actually six different investor decks you would want to develop?
We describe these six in more details in our “Founder? These are the six decks you need” if you are aiming for level two, you should pull together a 10-12 slide deck (what we call Short deck A: Your pitch deck), sufficient for pitch events with you on stage and early meetings; just don’t expect this to take you to anything resembling a successful funding round.
Six different decks you should build out.
3. Two decks, financial model
Slightly more advanced, you now develop both Short deck A: Your pitch deck and Introduction deck: Investment teaser.
But more than that, you also take the time to develop a robust financial model. This is a model showcasing your business model and your growth trajectories. Maybe also a base, bull and bear case scenario.
Now, investors will have a chance to dig into and test your assumptions, your CAC, your LTV, your margins, churn rates and all key factors in your business model.
Pro tip: if you are aiming to share your financial model, you might want to consider shooting a short Loom video where you walk through it, you know, just to make life a little bit easier for the junior analyst trying to understand your spreadsheet logic.
Everyone loves a good financial model. Just don’t expect everyone to understand yours…
4. Three decks, financial model, Investor FAQ
OK, so you got the three most important decks (Pitch deck, Investment Teaser and Executive Summary) you got a good financial model, now you expand into the world of Investor FAQs.
Effectively, these are the top 25 – 50+ questions you believe investors would want to ask you in meetings and during the DD process. This allows you to pre-empt the tough questions and also show you truly understand what your investors are looking for.
If you are not sure where to start, hit up Claude, upload your Investment Teaser and ask Claude to help you develop the Investor FAQ. Chances are, you’ll be both impressed and surprised.
5. Four decks, financial model, Investor FAQ, Investment instrument
Shifting into the more mature-levels, you now got your four most important decks (Pitch deck, Investment Teaser and Executive Summary and Short Deck B, First Meeting deck). You got the financial model, the FAQ.
Next, the investment instrument. Not all founders would want this. Some are looking for a lead investor to set the terms, choose the instrument and structure the round. But for many founders, especially those with some negotiation power, it is perfectly welcome for you to set the terms and choose the investment instrument. Usually easier in the earlier stages, most founders would opt for a capped SAFE note, a standard convertible loan agreement or maybe a standard debt structure.
As long as you are using “industry standard”, most early-stage investors are ok with it. Worst case, if you meet a strong lead investor candidate, you can both agree to replace your investment instrument with their choice (e.g. going from a capped SAFE to a priced round or a convertible), but for many angels and early-stage investors, they will appreciate you having an investment ready document to sign.
Ah, nothing says industry standards as a Canadian YC post-cap SAFE!
Going into level 6, you should now have most decks ready (Pitch deck, Investment Teaser and Executive Summary and Short Deck B, First Meeting deck), as well as model, FAQ and instrument. Next, you want to dig into those midnight hours and develop your Long Deck. The Long Deck, or Complete Investment Proposal, easily counts 20-100+ slides. We frequently see them at 45-50 slides. This deck is supposed to give your investors the opportunity to review in piece, read through every slide in detail – without having any founders present in the room. This is your full package, and should be packed with numbers, stats, KPIs and financial data. You might want to put this inside a data room, but in practice, a password protected DocSend is the way to to go.
At this stage, you also want to develop your VC investment memo. To many founders – and some investors – this might seem like a strange deliverable. After all, why should the founders spend time to write up a 20-30 page VC investment memo?
Well, we propose two main reasons for why this makes a lot of sense. First of all, for the founders to putting in the work and truly structure their work, strategy, go-to-market, long-term capital strategy, team bios, investor returns and deal outcomes, it provides the founders with structured depth and insights on their own company.
Second, one of the real-life bottle necks your VCs have is time, often more than capital. “We’d love to engage, but we just don’t have the bandwidth”, is a common phrase. Well, if you can provide them with a strong VC investment memo, you can easily save them 15-20 hours of time, and maybe, just maybe, be able to tip them over to looking closer on your deal.
Again, not sure where to start?
Try out this Claude Prompt:
“Please write up a world-class venture capital investment memo on our startup. Make sure to include: Executive summary, clear investment rationale, market overview, problem, solution, business model, traction, team, competitive landscape, KPIs and traction to date, long-term capital strategy, cap table analysis, deal analysis, round structure, investor outcome analysis, exit strategy and exit scenarios. Feel free to add or highlight other things you believe is key to developing a world-class VC memo.
Name: (insert), URL: (insert). All pitch decks and key financials attached.
Anyone can be a VC. Start by writing your own VC Investment Memo.
7. Six decks, model, FAQ, instrument, memo, shareholder agreement, cap table
OK, going to level 7, you are now truly maturing your investor materials. At this stage, you develop all six decks (Executive summary, Teaser deck, Pitch deck, Meeting deck, Introduction deck (investment teaser) and Long deck (Investment proposal). You got a solid financial model, FAQ, investment instrument. You got the VC memo.
Now you are adding the legal documents, namely Shareholder agreement and cap table (make sure to track this fully diluted) Granted, this should also have been included in the decks above and definitely the VC memo, but often, it is left out.
8. Six decks, model, FAQ, instrument, memo, SHA, cap & full data room
Finally, our last level, level eight. Now, you got all decks, financials, FAQ, instrument, VC memo, SHA and cap table. The only thing remaining; your data room, or VDR, Virtual Data Room. Many founders think about this as a data dump, a file repository. Smart founders understand differently. Smart founders design the data room through the lens of a world-class investor (customer) journey. “How can we make this a top-notch experience?”, “How can we use the data room to delight and impress investors”.
Here are three tips:
Make the structure easy to understand and navigate
Use guiding text to intro each main chapter or folder “In this folder you will find X, Y, Z. Make note of folder YY and ZZ”
Shoot introduction videos (Loom recordings) for each key part, always with the user’s journey in mind
Wanna build a data room? Use this as your guiding checklist
Closing out: from deck to investor ready materials
As I’m writing this, we are working hands on with 200+ founders across North America, MENA and Europe on different programs on Investor Readiness. This post if for you.
We hope this can serve both as an inspiration and checklist for the work you are all doing.
Next, we invite you to dig into the Funding Journey, where you can study the five phases and 43. Steps to close your next funding round.
So, you are getting ready to embark on the Scale Up! Train-the-Trainer? Exciting! This can be truly life-changing for your professional career!
Before you begin, here’s a couple of points you might like to know.
Scale Up! online format, with Katapult accelerator, Nov 2021
Part I: Ten fast facts
1. What is Scale Up? Scale Up! is a methodology to develop entrepreneurs, founders, angel investors, accelerators, incubators, VCs and ecosystem developers. The Scale Up! Methodology is based on 20+ years of experience supporting 1000’s of high-growth startup founders from pre-seed to post-IPO. The methodology is built on ‘working visually’, with a series of visual canvases and the visual Scale Up! kit.
2. What’s the core idea behind Scale Up!? In Scale Up! participants form teams and compete through the Founder’s Journey, taking a company from idea to successful exit. For most people, we do around 8-10 years in just three days.
3. How is Scale Up! delivered? In-person or online (using Miro and Zoom)
4. How can Scale Up! be run? Your imagination sets the only limitations; we describe seven different ways you can run Scale Up! We prefer the 3-day format, but half-day, one-day, two-day, five day or even 3-month formats are possible. It’s really up to you.
5. How many people have been through Scale Up!? Globally, ca. 4.500 to date
6. How many countries have Scale Up! been run so far? 50+
7. How many expert facilitators are there? ca. 70+
8. How many Scale Up! version are there? – Scale Up! (1.0) – Scale Up Angel! – Scale Up MENA! – Scale Up Africa Rising! – Scale Up Europe! (launching in 2026). More coming…
9. Who developed Scale Up!? Chris Rangen and his colleague Jolene Foo-Hodne was working with Innovation Norway, the Norwegian national innovation agency on a national program. This collaboration led to the first Scale Up! back in 20218.
10. Who can run Scale Up!? Globally, anyone can learn to run Scale Up! To date, faculty, VCs, accelerator staff, coaches and consultants have all learned to run Scale Up! With a bit of training and willingness to learn, anyone can.
Founders, investors, ecosystem builders – all benefitting from Scale Up!
Part II: Two types of knowledge
The two sets of expertise you will develop For anyone running Scale Up!, there are two skillsets you need. We count these on a one to five level, from beginner to expert.
Domain knowledge Domain knowledge is how much you know about the content, the term sheets, the deal structures, the cap table math and how to bring together a 2M @4M post SAFE, with a 500.000 @3M pre equity round, while also keeping the initial angel investors happy and structuring a 12% post-round ESOP.
Domain knowledge is important. It is what you know. It is the foundation you use to teach, coach and mentor others. Everyone should strive to develop their domain knowledge.
But domain knowledge alone is not enough.
Facilitation knowledge Next, you have faciliation knowledge, or really faciliation skills. How comfortable are you with structuring programs, designing multi-stakeholder workshops and facilitating high-paced masterclasses? Can you manage large groups, in both online and in-person formats?
Can you use your voice well? Can you give instructions clearly? Can you design a workflow to keep people engaged over multiple days?
For most of us, these two sets of skills is something we work on constantly, day in and day out. You never graduate, you just keep getting better and better over time.
Getting to level five ….takes real, genuine work
Part III: The five core topics you will master
Our train-the-Trainer is designed around five core topic areas. Each represents a critical piece of the puzzle every Scale Up! Expert Facilitator needs to handle with confidence.
1. Founder’s Journey From IPO dreams to the messy realities of taking a company public, you will learn to guide participants through every twist and turn. This is the backbone of Scale Up! – understanding what founders actually go through from idea to exit. Can you tell stories, of success and failure from across the Founder’s journey?
2. Term Sheets 600+ term sheets. SAFE notes. CLAs. Priced rounds. Liquidation preferences. You will learn to read, understand, and explain even the most complex investor term sheets. Did you know there is such a thing as ‘too many term sheets’? You will.
3. Cap Tables From foundational equity to Series K dilution, cap table mastery is non-negotiable. You will learn to help founders understand how their equity evolves – and how to protect it.
4. Ten Steps to Scaling Up This is where strategy meets execution. Scale up mindset. Exit planning. Equity management. ARR velocity. Team development. Market expansion. Customer discovery. Financing. Product development. Scaling with AI. Ten interconnected elements that determine whether a startup stays stuck – or scales.
5. Liquidity & Exits The ultimate question: how do you return value to investors? M&A, IPO, secondary transactions, partial liquidity – you will learn to facilitate conversations most founders have never had. Combined, these five are the core topics you need to study up on to build out your domain expertise.
Scale Up! Train-the-trainer Structure
Part IV: Three levels of development
Here’s the thing about becoming a Scale Up! Expert Facilitator. It’s not about reading a manual. It’s about a progression through three distinct levels.
Knowledge This is where you start. Learning the content. Understanding the frameworks. Reading term sheets. Studying cap table math. Getting fluent in the visual canvases, the Founder’s Journey, the Investor Map, the Rocketship Canvas. You are building the internal library that allows real improvisation later.
Confidence Knowledge is not enough. Confidence comes from running programs. From co-facilitating with masters. From leading a full simulation and experiencing what it feels like when things go sideways – and learning to recover. This is where the nervous system develops. Where you learn to sense what a room needs, moment to moment.
Mastery Master facilitators create unseen structure and invisible support. They make profound learning look effortless. They adapt mid-session to emerging themes without losing coherence. They know when the ‘wrong’ conversation is actually the most important one. Mastery is not perfection – it’s the hard-won ability to orchestrate genuine transformation.
Scale Up! online format, Nov 2021
Part V: What a typical Scale Up! session looks like
Here, we use a three-day format. You can of course mix and match this around to best suit your format. You can easily adapt to a one-day format, two-day or even five-day.
Day 1: The Foundations
The Welcome session kicks off with the Founder’s Journey, Investment instruments and Foundational equity. You will dive into Strategy 101, Pre-seed/seed stage dynamics, ESOP structures, Term sheets, Investor mapping, Product development and Pitch deck fundamentals.
By the end of Day 1, teams will have navigated 30+ term sheets across 2-5 rounds, managing raises from 1M – 10M at valuations of 10M – 30M. Boom cards. Bust cards. Burn rates from 10.000 – 100.000. Welcome to the founder’s reality.
Day 2: Scaling Up
Day 2 opens with a Pitch session. Now you take teams into venture territory. Sales organization. Market expansion. Long-term capital strategy. 3x Value uplift. Boards & governance. Rocketship canvases. LinkedIn positioning. Complex term sheets. SAFE conversion mechanics. Product mastery. Investor liquidity & returns. Outcome canvas analysis.
The complexity ramps up. Each team should see term sheets: 30-40. Rounds: 3-5. Raises: 20M – 100M. Valuations: 100M – 500M (and pushing toward 1BN). Boom: 10-30. Burn rate: 500.000 – 5M. This is where scaling founders separate from starting founders.
Day 3: Growth & Exit
The final day opens with an Outcome pitch. You are now in growth stage territory. Global leadership. Market expansion. Margin expansion. Investor questions and power dynamics. M&A strategies. Liquidity transactions. IPO readiness. Exit transactions.
The stakes are highest here. M&A: 0-3 deals. Term sheets: 20-40. Rounds: 1-5. Raises: 50M – 1BN. Valuations: 10M – 30M? Not anymore – we’re talking multiples higher. Boom: 10-15. Burn rate: 10M – 20M. This is where winners are made.
Globally, over 70 people are now trained and certified to deliver Scale Up! programs. They work in 50+ countries. They’ve taken nearly 4.500 founders, investors and ecosystem builders through the journey.
As an Expert Facilitator, you will join this global community. You will gain the ability to transform how founders think, how investors evaluate, how ecosystems develop.
The best part? The journey from Learn to Run to Apply to Fly is one of the most rewarding professional development paths you can take. Each program you deliver, you get better. Each challenging term sheet negotiation you facilitate, you grow. Each breakthrough moment you witness – a founder finally understanding their cap table, an investor seeing the power dynamics differently – reminds you why this work matters.
One day, this will all be yours…
Ready?
The Scale Up! Train-the-Trainer is not a certification you collect. It’s a capability you develop. A community you join. A journey you commit to.
From Knowledge to Confidence to Mastery. From Day 1’s foundations through Day 3’s exits. From your first nervous co-facilitation to the flow state of mastery.
This year we expect to train and certify 50-60 Scale Up! expert facilitators. If you are one of them, here are nine ways you can run Scale Up!
Accelerating entreprenurship with Scale Up!
Globally, 1000’s of founders, investors and ecosystem developers have built their ‘scale up skills’ with Scale Up! From introduction to cap table math, accelerating seed-stage founders or training investors on deal structures, partial liquidity mechanisms and IPO readiness, over the years we have seen a broad range of use cases of Scale Up!
Expert Expert facilitators like Scott B. Newton, Rick Rasmussen, Rumbi Makanga, Enrico Maset, Sanjana Raheja and many, others are pushing to create new best practices in Scale Up! delivery.
African accelerators, European family offices, Middle Eastern fund-of-funds, Nordic innovation clusters, US business schools, global impact accelerators and global entrepreneurship organizations are just some of the 100’s and 100’s of users who have picked up Scale Up! in recent years; but how can you run Scale Up!?
Well, in our work, we have identified nine different ways you can run Scale Up!
Before we start
Before getting into the details, the first question is always, “are you running this online or in-person”.
Scale Up! has been delivered 100’s of times in both formats. But what are you planning?
Some people strongly prefer the online version, noting the flexibility of adding new content, combined with nobody needing to travel. For many, the online format can be perfect. Others prefer the in-person setup. Being in the same room together. More energy, more collaboration, more engagement, more teamwork.
There is no right or wrong, it’s simply up to you, which format you prefer.
In-person, Bergen Norway vs. Katapult Impact Accelerator, online. Same, but different.
1. “Bits and pieces”
Duration: Varies, from 30. Minutes to days
Format: online or in-person
Example: Hatch Founder Workshop
The “Bits and pieces” format allows you to extract certain pieces from the Scale Up! kit and work with it, without having to run the entire simulation.
This is great if you are running shorter sessions, focused workshops or want to zoom in one a certain topic, without bringing the full kit. Expert facilitators like Enrico or Javier, regularly use the Scale Up! Strategy cards in founder coaching conversations, while I run multiple exercises for founders on the Investor Map and Long-term funding roadmap, combined with a handful of Scale Up! Investor cards.
There is no one best way to run this, feel free to mix and match the bits and pieces as you see fit.
Long-term Funding Roadmap, using investor cards from Scale Up!, Hatch Accelerator, Sep 2023
Or, if you prefer the in-person format.
Completing the Long-term Funding Roadmap, using Investor Cards from Scale Up! Innovation Norway, Sep 2023
Imagine having friends over for dinner, and all you serve them is an appetizer and that’s it. That’s a Discovery session for you. It is a taster. Nothing more. But for most people, it is great way to get a first taste, a first chance to see Scale Up! in action. Just be clear on format and expectations. This is not a full program. It not even a full introduction. But for a couple of hours, it serves as a great appetizer.
Scale Up! Discovery session, online, July 2024
3. Pilot
Duration: 1 day
Format: Beginner and intermediate, introduction focused
Example: Scale Up MENA! pilot in Dubai
Pilots are a great way to get people introduced to and initially started on Scale Up!
A good pilot session is usually a full-day (5-8 hours), something most founders can carve out time for. A good pilot will have four sections throughout the day. – Welcome & introductions (20. Minutes) – Opening lecture (30. – 90. Minutes) – Hands-on, in teams, running Scale Up! (3-6 hours) – Debrief, next steps and how to move from pilot to full program
We recommend most new facilitators to plan for 5-20 Pilot sessions per year, as it has proven to be a great way to get going with Scale Up! in a new market or ecosystem. Most founders, once they have tried a pilot session, usually want more – and soon.
100+ founders met Scale Up MENA! through a series of pilots in Dubai in November 2025
4. Workshop
Duration: 1-3 days
Format: varies from light, entry-level, to advanced, depending on the group
Example: 2-day Scale Up! workshop with the Ocean Startup Project in Canada , or 1-day with EO Dubai.
The workshop format is standard, full-scale delivery. But a workshop tends to be shorter, slower and less advanced in terms of content than a Masterclass. We have done 100’s of workshops. They are great. But think about workshops as the little brother against the Masterclass.
In a workshop format, you would aim to run Scale Up! from start to successful exit (end); but you have more flexibility in terms of content (take things out), pacing (slow things down), and adjust to the topics the group wants to focus on. A workshop is a very flexible format.
Often, the workshop format ties well into ongoing client engagements, where you decide to run Scale Up! as a part of a larger engagement. We frequently do this with angel networks, family offices, incubators, accelerators and ecosystem developers with great effect.
What Canadian ocean founders said, Nov 2021
5. Masterclass
Duration: 2-3 days (3 days recommended)
Format: advanced level, complex, fast-paced, challenging, but also incredibly engaging
A Masterclass is an advanced, fast-paced, stand-alone delivery of Scale Up! It usually runs over three days, in some cases 2,4 or even 5 days.
What makes a Masterclass stand out is the full-on pace, advanced content and focus on taking all teams through the best possible experience we can.
A Masterclass is planned down to every 15. Min slot, and covers a number of Founder Tasks, Breakout exercises and Strategy Tools canvases. A robust Masterclass will take participants through every step of the scaling up journey, and focus significant attention on the later-stage issues, such as Outcome Canvas, partial investor liquidity and a full exit transaction. Depending on the level of the participants, an exit transaction can end out in a ‘quick M&A’ (takes around 20. Minutes to complete) or a full-scale IPO process (takes around 3-4 hours to complete).
Personally, the 3-day Masterclass is my favorite format, as participants tend to lean in, work hard and we can see massive progress with just a few days of work.
Three day, Scale Up! Masterclass, Bahrain, April 2024
6. Program
Duration: 30-90 days, could be more
Format: Usually quite advanced, depending on the group. Covers a broad range of topics, with Scale Up! being very central.
Example: 30-day Investment Readiness program with Katapult Accelerator, Savant Accelerator, Link Capital or GIZ
A program structure means Scale Up! is just a small piece in a larger entreprenurship program. This can be a one week program, a four week program, a 90-day program or longer. With Katapult, we run a 30-day, high-intensity program.
In a program format, we usually plan for Scale Up! as one of the cornerstone activities, but we also plan for a lot more work and content than just Scale Up! Over the years, we’ve run a significant number of the 30-day Investor Readiness Sprint, a 30-day, intense, packed program to get founders truly investor ready, and radically increase their chances of successfully raising their next round of equity investment. In this format, we recommend founders to allocate 100-150 hours per startup team, with Scale Up! taking less than 15 hours.
In your work, you can probably see many program structures where Scale Up! can be a small piece of the bigger picture.
In a program format, like the 30-day Investor Readiness Sprint, Scale Up! is just a small piece in a larger puzzle
7. Education
Duration: From one day to a full semester
Format: Depends on learning goals, levels and target outcomes.
Example: FHV, Northwestern, ESCP and many, many more levels: Scale Up! is used in educational programs from High School (Canada), Business School (Europe and the US) and technical universities (Europe)
The first time we brought Scale Up! into a classroom was in Dornbirn, Austria (truly, in the Austrian alps) in October 2021. Since then, 100’s and 100’s of entrepreneurship students have experienced Scale Up! as a part of their educational programs.
In Canada, Stuart and Michael have been running an innovative space tech x Scale Up! high school program, as well as multiple university programs. In Germany, Austria and Italy, Enrico has been teaching with Scale Up! across programs. In Silicon Valley, Rick has been educating future startup founders with Scale Up! In London, Vishal is teaching entreprenurship with Scale Up!
Rick, Chris (and Enrico), teaching entrepreneurship in the Austrian alps
8. Multi-year programs
Duration: Runs into years
Format: Varies significantly, but usually several Scale Up! sessions over time
Example: Reinventing the Norwegian innovation cluster program
A multi-year program might take the shape of a larger ecosystem development initiative, a national transformation program, a business angel development program or simply upskilling
In Norway, from 2017-2021, we ran a multi-year program on reinventing the national, Norwegian innovation cluster program. Here, Scale Up! was a cornerstone in the project. Over these 4-5 years, we probably ran 30 Scale Up! sessions of different lengths and formats. In Cairo, working with Tiye Angels, we run a multi-year program covering early-stage founders, scaling founders, angel investors and ecosystem coaches.
For anyone who might have a chance to plug Scale Up! into a multi-year development program, expect to see huge improvement in your own expertise and mastery in how you run Scale Up!
Looking ahead, we can see many forms of these multi-year programs:
Boosting the Nordic tech ecosystem
Scaling the European startup ecosystem
Taking the UAE and MENA ecosystem to the next level
Upskilling a generation of startup founders in Saudi Arabia – Developing stronger financial and fundraising skills in South East Asia
Boosting accelerators and Business Support Organizations in Latin America
Building deep skills in entreprenurial finance, cap tables and fundraising in Africa
These are just a handful of the Scale Up! multi-year programs we would love to see coming up, led by you, as the new expert facilitators.
Early-days, bringing Scale UP! into the Norwegian innovation cluster program, 2019-2020
9. Train-the-trainers
Duration: From a few days to multiple months
Format: Blended, online or in-person (most do blended)
One day, hopefully, some of you might want to start training and supporting new Scale Up! expert facilitators in your ecosystem. Go for it! One of the best ways to learn is by teaching others.
We have taught, trained and certified 70+ Scale Up! Facilitators, closer to 300 if we count everyone that has been through the Train-the-trainers, but not necessarily taken up Scale Up! as a professional track.
In your case, if you have an accelerator team, local business school faculty or a network of consultants and investors you work with; go for it. Put together a new, innovative Train-the-trainers program in your ecosystem, or let’s work together with you running our standard TTT program, in your part of the world.
Who knows, maybe you will be the one to unlock 100’s of new Scale Up! facilitators, you just don’t know it yet.
Train-the-trainers, or expert-level certification, we have trained 100’s of people in running Scale Up! Maybe you will too?
The best way? Just get started
In this blogpost we have outlined ten ways you can run Scale Up! From classrooms to workshops, from multi-year programs to discovery sessions; the choice is yours.
Scott B. Newton in action, Dubai, June 2023. Be more like Scott.
Regardless, the best way to run it is simply getting started. Enrico, one of our most experienced Scale Up! facilitators, once said, that new facilitators (like yourself) should aim to run 20 sessions, minimum, in the first year. With 20 sessions, you build muscle memory, confidence and quickly gain mastery. Just get started.
On our end, we are excited to see what you will do with Scale Up! in the coming years – ultimately supporting startup founders to build and scale better companies in your part of the world.
https://i1.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1768089283364.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2026-02-03 17:08:052026-05-01 17:08:23Nine ways to run Scale Up!
When startup VC exits does not happen by themselves, what’s a VC to do? Exploring the topic of discussing liquidity and exit strategy at term sheet level.
First article leading up to the upcoming Dune Venture Days in Dubai.
The Exit Gap in Most VC Markets
Across MENA, Africa, and Europe, venture capital ecosystems share a common challenge: the path to liquidity remains uncertain, unpredictable, and often an afterthought. In MENA, startups have raised over $11 billion since 2021, yet fewer than 7.5% have achieved exits. Africa recorded only 26 venture-backed exits in 2024, returning just $0.13 per invested dollar. European secondary markets, while more developed, still leave many GPs scrambling when fund lifecycles demand returns.
The numbers tell a challenging story. The VC markets across MENA, Africa and Europe are all maturing, evolving, even booming in the case of MENA. Deals are happening, new funds are being set up, but…….. everyone is also waiting on liquidity and DPI.
This raises a fundamental question: Should exit thinking be embedded directly into the term sheet itself?, or more precisely, how should liquidity strategy be presented in your term sheet?
The GP Exit Canvas: A Framework for Strategic Exit Planning
The GP Exit Canvas, developed through extensive work with fund managers across global VC markets, provides a structured visual framework for integrating exit strategy thinking from day one of the investment process. It consists of nine interconnected building blocks:
GP Exit Canvas
Building Block
Pre-Deal Assessment
How do we work on exits in our pre-deal assessment?
2. Key Documents
What exit items do we use in term sheets, shareholder agreements, and exit memos?
3. Exit Strategy BOD Day
How do we design and deliver an annual board exit strategy day?
4. Mapped Out Exit Paths
How well do we map out exit paths for each portfolio company?
5. Exit Committee
How do we setup and run an exit committee years ahead of a transaction?
6. GP Exit Team
Do we have team members dedicated to exits?
7. Exit Advisors
Who are the right exit advisors for our portfolio companies?
8. Exit Network
How large is our relevant exit network and how can we grow it?
9. Exit Dealmaking
Are we successful in completing exit transactions?
Notice that “Key Documents” sits prominently in this framework. The canvas explicitly asks: What are the key exit items we use for the company’s legal and strategic documents? Do we use a tiered exit model at various company stages? This is where the term sheet becomes a critical tool for exit planning.
The VC Debate: Should Term Sheets Include Exit Provisions?
The question of whether to include explicit liquidity and exit provisions in term sheets divides opinion among fund managers. Let’s examine both sides.
The Case Against
Premature constraints on founder optionality. Critics argue that embedding exit timelines into term sheets creates rigid structures that may not serve the company’s best interests. Markets shift, opportunities emerge unexpectedly, and what looks like the right exit path at Series A may be completely wrong by Series C. Founders need flexibility to pursue the best outcomes, not contractual obligations that force premature decisions.
Potential misalignment with founder vision. Some founders view explicit exit provisions as a signal that investors are more focused on their own returns than building a truly transformative company. This can create tension from day one and may deter founders who are building for the long term.
Negotiation complexity. Adding detailed exit provisions increases the complexity of term sheet negotiations, potentially slowing deal velocity and adding legal costs at a stage where founders often have limited resources.
The Case For
Alignment from day one. Proponents argue that discussing exit paths early actually creates better alignment between founders and investors. When both parties understand and agree on potential liquidity scenarios, there are fewer surprises later. As the GP Exit Canvas emphasizes, exit planning isn’t separate from investment strategy—it is investment strategy.
LP pressure demands clarity. Limited Partners are increasingly demanding DPI (distributions to paid-in capital) rather than just paper returns. In markets like MENA and Africa, where exits are scarce, LPs want to see evidence that GPs have thought through liquidity paths before committing capital. Having exit provisions in term sheets signals sophistication and planning.
Structuring for market realities. In regions with underdeveloped IPO markets and fewer strategic acquirers, secondary sales and tiered liquidity models often represent the most realistic path to returns. Building these mechanisms into deal structures from the start ensures they can be executed when opportunities arise.
Creating exit-ready documentation. When exit opportunities emerge, deals often fail because documentation isn’t ready for institutional buyer due diligence. Term sheets that anticipate exit requirements—drag-along rights, tag-along protections, information rights—create companies that can move quickly when windows open.
The Verdict: Yes, With Nuance
The evidence is clear: paths and timelines to liquidity are key for VCs and should be covered in term sheets. However, this doesn’t mean imposing rigid exit schedules or forcing founders into narrow outcomes. Instead, it means creating flexible frameworks that acknowledge the importance of liquidity while preserving optionality.
The most successful VCs think backward from liquidity events when making investment decisions. As the GP Exit Canvas demonstrates, this backward-thinking approach should be embedded in every aspect of the investment process, including the foundational document that governs the investor-founder relationship.
For emerging market funds, where smaller pools of potential acquirers and less developed exit markets create additional challenges, the discipline of incorporating exit thinking into term sheets can mean the difference between a successful fund and one that struggles to return capital to LPs.
Three Liquidity Mechanisms: Sample Term Sheet Language
Below are three examples of different liquidity mechanisms that can be incorporated into term sheets, each suited to different investment contexts and portfolio company stages.
1. Strategic Acquisition Facilitation Clause
Context: Appropriate for early-stage investments where strategic M&A is the most likely exit path, particularly in sectors with active corporate acquirers (fintech, healthtech, agritech).
SAMPLE TERM SHEET LANGUAGE
Exit Strategy Facilitation
Strategic Exit Support: Upon the Company achieving annual recurring revenue of [USD 2,000,000] or cumulative revenue of [USD 5,000,000], the Investors shall actively facilitate introductions to potential strategic acquirers identified in the pre-investment Exit Path Assessment. The Company shall maintain an updated list of no fewer than fifty (50) potential strategic acquirers, reviewed and updated at each Board Exit Strategy Day.
Exit Readiness Milestones: The Company agrees to achieve “exit-ready” status within thirty-six (36) months of closing, including: (a) completion of SOC 2 Type II certification or equivalent, (b) audited financial statements prepared in accordance with IFRS, (c) documented regulatory approvals and compliance records, and (d) clean cap table with all option grants properly documented.
Drag-Along Rights: In the event of a bona fide acquisition offer valued at or above [3x] the post-money valuation of this round, approved by (i) a majority of the Board of Directors and (ii) holders of a majority of the Preferred Stock, all shareholders shall be required to participate in such transaction on the same terms and conditions.
Information Rights for Exit: The Company shall provide Investors with monthly operating metrics in a format suitable for potential acquirer due diligence, and shall grant Investors reasonable access to management for the purpose of facilitating strategic discussions with potential acquirers, subject to appropriate confidentiality protections.
2. Tiered Liquidity Model (1/3, 1/3, 1/3 Structure)
Context: Designed for growth-stage investments where the investor seeks to manage risk and generate early DPI while maintaining upside exposure. Particularly relevant in MENA and Africa where full exits are rare but secondary markets are developing.
SAMPLE TERM SHEET LANGUAGE
Tiered Liquidity Structure
Liquidity Schedule: The Investors’ shareholding shall be subject to the following tiered liquidity framework, designed to balance early returns with continued participation in Company growth:
Tranche 1 – Series B Secondary (One-Third of Position): Upon completion of the Company’s Series B financing round at a pre-money valuation of at least [3x] the post-money valuation of this round, the Investors shall have the right (but not the obligation) to sell up to one-third (33.33%) of their shareholding to incoming investors or approved secondary buyers. The Company shall use commercially reasonable efforts to facilitate such secondary sale as part of the Series B transaction, including allocating reasonable capacity in the round for secondary purchases and providing necessary documentation and representations.
Tranche 2 – Pre-IPO/Series D Secondary (One-Third of Position): Upon completion of a Series D financing round or a pre-IPO financing round at a pre-money valuation of at least [8x] the post-money valuation of this round, the Investors shall have the right to sell an additional one-third (33.33%) of their original shareholding (or 50% of remaining position) through secondary sale mechanisms. The Company agrees to include standard secondary sale provisions in its Series D or pre-IPO documentation, and shall not unreasonably withhold consent to transfers to qualified institutional buyers.
Tranche 3 – Ultimate Exit/IPO (Remaining Position): The Investors’ remaining shareholding (one-third of original position) shall be held until the Company’s ultimate liquidity event, whether through IPO, strategic acquisition, or other qualifying exit transaction. In the event of an IPO, the Investors agree to customary lock-up provisions not exceeding one hundred eighty (180) days, following which they may dispose of shares at their discretion.
Valuation Floor Protection: The secondary sale rights described in Tranches 1 and 2 above shall only be exercisable if the applicable round valuation represents at least a [2.5x] multiple on the Investor’s cost basis for Tranche 1, and a [5x] multiple for Tranche 2. If such thresholds are not met, the secondary rights shall roll forward to the next qualifying financing round.
Company Facilitation Obligation: The Company shall designate a member of senior management responsible for coordinating secondary sale processes and maintaining relationships with secondary market platforms and qualified buyers. The Company shall not impose transfer restrictions or exercise rights of first refusal in a manner designed to frustrate the Investors’ exercise of the rights described herein.
3. Redemption and Put Option Mechanism
Context: Appropriate for later-stage investments or situations where market exit uncertainty is high, providing investors with a guaranteed liquidity path while giving the Company flexibility on timing.
SAMPLE TERM SHEET LANGUAGE
Redemption and Put Option Rights
Redemption Right: Commencing on the sixth (6th) anniversary of the closing date (“Redemption Date”), and upon written request from holders of at least a majority of the then-outstanding Preferred Stock, the Company shall redeem the Preferred Stock in three (3) equal annual installments at a price per share equal to the greater of: (a) the original purchase price plus any accrued but unpaid dividends, or (b) the fair market value as determined by an independent valuation conducted by a mutually agreed third-party valuation firm.
Put Option: In the event that no qualifying liquidity event (defined as an IPO, strategic acquisition, or secondary sale opportunity at or above [2x] the original purchase price) has occurred by the fifth (5th) anniversary of closing, the Investors shall have the right to require the Company to facilitate a sale of the Investors’ shares to (i) existing shareholders, (ii) the Company (subject to legal restrictions), or (iii) third-party buyers identified by the Company, at a price equal to the higher of (a) [1.5x] the original purchase price or (b) fair market value as determined by independent valuation.
Company Call Option: The Company shall have the right, but not the obligation, to call and repurchase the Investors’ shares at any time after the fourth (4th) anniversary at a price equal to the higher of (a) [2.5x] the original purchase price or (b) fair market value. This call option shall expire upon the occurrence of a qualifying liquidity event.
Exit Window Coordination: The Company agrees to engage an investment bank or M&A advisor to conduct a formal market assessment of exit opportunities no later than the fourth (4th) anniversary of closing, with the results of such assessment to be shared with the Board of Directors and used to inform liquidity planning discussions.
Note to self, work with fancy lawyers on exit terms; but start on day 1. You don’t need to wait for year 8 to begin….
Implementing Exit Thinking: Practical Steps for GPs
The GP Exit Canvas provides a comprehensive framework for making exit planning systematic rather than sporadic. When implementing exit provisions in term sheets, consider these principles:
Start the conversation early. Use the pre-deal assessment phase to discuss exit scenarios openly with founders. This conversation will inform which term sheet provisions are most appropriate and help identify potential misalignment before it becomes a problem.
Match provisions to context. A fintech startup with clear strategic acquirer interest needs different provisions than a B2B SaaS company targeting eventual IPO. The three examples above illustrate this range—use them as starting points, not templates.
Build in flexibility. The best exit provisions create optionality rather than obligation. Rights to sell don’t mean requirements to sell. Valuation floors protect against fire sales while preserving upside.
Integrate with governance. Exit provisions in term sheets should connect to ongoing governance mechanisms—annual Exit Strategy Board Days, exit committees, and regular exit readiness assessments as outlined in the GP Exit Canvas.
Communicate with LPs. When raising your next fund, point to these term sheet provisions as evidence of your systematic approach to liquidity. LPs increasingly want to see DPI, and demonstrating that you’ve built exit thinking into your investment process from day one differentiates you from GPs who treat exits as an afterthought.
Conclusion
In venture capital, capabilities compound over time into competitive advantages. Funds that embed exit thinking into their term sheets—and across all nine elements of the GP Exit Canvas—build a systematic capability that serves portfolio companies, LPs, and their own track records.
For fund managers operating in MENA, Africa, and Europe, where exit markets remain challenging but opportunities are growing, this systematic approach isn’t optional—it’s essential. The term sheet is where that discipline starts.
The most successful venture capital firms don’t just pick winners; they systematically create the conditions for winning exits. Make your term sheet part of that system.
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About Dune Venture Days: Welcome to the first edition of DUNE Venture Days: a complimentary, invite-only venture capital gathering designed for a curated group of VCs, startup investors, and ecosystem leaders. DUNE will take place in partnership with Dubai CommerCity and alongside the WORLDEF Dubai 2026 Conference.
DUNE is 100% complimentary. It is simply about giving back to the VC ecosystem — a moment to strengthen existing relationships, build new ones, and bring together people we genuinely enjoy exchanging ideas with. Apply to join at Dune Venture Days.
Welcome to Dune Venture Days
About the GP Exit Canvas: The GP Exit Canvas is part of the Venture Capital Series developed by Strategy Tools. Download the canvas and explore additional resources at www.strategytools.io.
About the Author: Christian Rangen is a strategy advisor and business school faculty member who works with VC/PE firms, fund-of-funds, DFIs, and governments on venture capital ecosystem development. He delivers VC Masterclasses and mentors fund managers globally.
https://i1.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1768594287584.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2026-02-03 17:02:012026-05-01 17:02:17Should Exit Thinking Be Mentioned in Your Term Sheet?
Having run 100’s of Strategy Sims Masterclasses we’ve learned how to best plan and structure a program for maximum value to the participants. One way of increasing the value, is to ensure that you, the facilitator and your team are sufficiently prepared . here are 14 questions you can ask yourself, if you are preparing to run a session – with a focus on digital.
Note, in this article we focus on Scale Up!, but the structure is equally valid for Fund Manager!, Transform! or any of the other Strategy Sims.
Scale Up! fact box Scale Up! comes in multiple editions: – Scale Up! (Global) – Scale Up Angel! – Scale Up X! – Scale Up MENA! – Scale Up Africa Rising! – with more editions due out 2026
This is your universe to manage.
1. Who are your participants?
What’s their level? What’s their expectations? How well do you know the participants you will be working with? Make sure you have a deep understanding of your audience, and truly design a program with their level and expectations in mind.
Not sure who you will be meeting? That’s okay; run two webinars in advance to get to know them.
2. What’s your framing?
How do you position this? Short, fun session? Learning opportunity for beginners? Advanced-level “I will teach you…” vs. “I expect you to handle everything we throw at you…”?
Personally, I like to frame Scale Up MENA! with “Can you outperform Careem? $3,2BN exit in 7 years. Can you beat it? Good luck” For Africa Rising!, we use Moove. “Can you outperform Moove? From Africa to the world. From pre-seed to $100M with Uber. Can you top it?” For early-stage founders, maybe the framing is ‘can you avoid bankruptcy’?` Think about the framing, the narrative you want to go for.
3. What’s the core content you want to focus on?
You only have a few hours, truly, what are you going to focus on?
Pre-seed fundraising? Global market expansion? Cap table management? Growth stage fundraising? Long-term capital strategies? Partial liquidity? Investor outcomes? IPO process? Once you know your audience, decide on your core content. This is particularly important for choice of canvases you will be using.
Investor Map, great for beginners.Outcome Canvas – advanced groups only
4. What’s the outcome you seek?
When participants finish, what should they be able to do or know, that they did not going into the program? What do you want them to walk away with? What are the learning outcomes? The knowledge outcomes you expect to see? Make sure to spend time on this. Get this right. Upon completion of the participants should know: – – – and they should be able to do: – – –
5. What does ‘winning’ look like?
In Scale Up!, ‘winning’ can take many forms. It is 100% up to you to decide. Got super-early-stage founders? Make it ‘first team to raise three rounds – and make it over the goal line’. Or, ‘first team to hit 10M ARR – without going bankrupt – and make it over the goal line’.
More advanced, intermediate founders? ‘Raise six rounds of financing, complete at least one syndicate and hit 10M ARR – and make it over the goal line’. Or, ‘secure the best possible exit, simply’. Late-stage, advanced founders? ‘Best exit wins’, or ‘Lead the company through, seven rounds of financing, one syndicate, 10M ARR and a successful IPO transacttion’.
Before you start, always know – and communicate – what ‘winning’ looks like.
Winning, with exits and unicorns
6. Program structure – or stand alone session?
Is this part of a larger program, likely an investor readiness program or an entirely stand-alone Masterclass? Are you running pre-session Webinars – or not? Our recommendation is generally to run one or two pre-session webinars in advance, to help participants tune in, set expectations and prepare.
Webinar 1: Introduction to Scale Up! Why we are doing this Background Three types of companies (SME, local tech, global tech, what are you building?) The Founder’ Journey – and the funding from idea to IPO Next steps (+ access to pre-read)
Webinar 2: Recap on introduction Financing the Founder’s journey Investment instruments overview Term sheets (real-life) and Investor cards Recommendations for how to best prepare (pre-read, pre-work, pre-videos)
7. Pre-read package
What are you providing the participants to read in advance? For Scale Up Africa Rising!, we are now developing the following pre-read package:
i. Case Study: Scaling Payzhub (50+ pages)
ii. Angel E-mail (core instructions)
iii. Team & Roles (team setup)
iv. Founder Handbook (explaining)
v. Real-life SAFE note (Example)
You, of course, select your own package.
Scaling Payzhub case, when the founders were still young and naive
8. Pre-work package
What are you putting together for the pre-work package? What are the pre-session training exercises you want people to do? Are you holding people accountable for completing it? Are you reviewing and giving people feedback before the session? Or, are you just saying ‘complete it, good luck’?
We know from experience that only 20% – 50% will complete the pre-work package, but the ones that do, will have a massive advantage and be key people on their respective teams. For Scale Up Africa Rising! Pre-work package we are doing:
I. Founder Handbook: 10 Building blocks (exercises) (40-60 pages)
II. Founder Workbook: Edustream (exercises) (27 pages)
Edustream workbook
9. Pre-session videos
Are you using pre-session videos? If so, who’s shooting them? What’ the key content we focus on?
The videos we would recommend are.
I. Intro & welcome video. Introducing Scale Up! Miro board overview. Walkthrough of the Miro board and how to navigate it (15. – 35. Min). (see example)
II. Pre-session exercises. Hands on training materials (15. min). (See example)
III. Founders Journey video (can be replaced by Webinar I)
IV. Investment Instruments, Video (with linkage to the pre-work package) (can be replaced by Webinar 2)
Scale Up! Intro Part I. Walkthrough of the Miro board.
10. Is your detailed program design truly ready?
Have you mapped out every 15. Min block yet? Have you pre-selected all Founder Tasks and Strategic Dilemma you want to run? Have you clearly defined ‘milestones’ for end of each day? Running a Scale Up! without a detailed program design is…. Unwise.
Offsites (for the roles, like CEO, CRO, CFO, etc)
Breakouts (for the teams)
Breaks (coffee breaks) (step away from the computer, for real)
Everything need to be pre-arranged, clearly mapped out.
For example, if you want teams to make any decisions, they need to be in the same breakout room together. No offsites, expect to decisions. For every 60. Min (hour), plan for minimum two, maybe even three team breakouts.
Use the Scale Up! Masterclass Design Canvas
Running a true Masterclass? Plan your program in 15. Minute blocks. Seriously.
(Did you know, In our experience, if there is no detailed design in place, we tend to cover only 60% of the plan we hoped to cover for the day. With a detailed design in place, we are pretty much at 95% – 100%.)
One-day, basic workflow, Scale Up MENA!Three-day workflow, Katapult Accelerator, 4-hour days + 2-3 hours between sessionsZooming in one day 2 content.
11. Have you clearly assigned roles on the facilitator team?
Who is leading the plenary and sharing screen? Who is handling cards? Who is leading the offsites? Who is jumping from room to room, to support the teams? Who is running the Investor Map, Long-term Funding Roadmap and Outcome Canvas? Who is helping teams with cap tables?
All this need to be pre-set in advance.
KO facilitator team
12. Is your logic flow in place
Scale Up! is structured around what we call the Founder’s Journey. Over a few days, we typically cover 6-10 years of ‘startup life’. Make sure your plan, your design capture this in a logical manner.
Every roll with the dice represent a few weeks of ‘real life founder life’.
Every square on the board represent ca. 9 days.
Every length of the board represent 3 months or 90 days.
Every round around the full board represent a full year.
This means, the entire first round around the board is year 1. Think about, what happens, really, in year 1. Team coming together, early customer discovery, a grant. Maybe an angel investor. Possibly an accelerator. Maybe a friends and family round. Maybe first revenue, often wrapped in a pilot structure. Possibly an advisor or two. Maybe a few new team members. That’s often it. Some companies will hit $100M ARR and level five product, go-to-market and expand into six markets, but that’s extremely unlikely. Plan for a ‘normal’ growth phase, where pre-seed, seed, seed+ and Series A takes 2-4 years, not 3-4 rolls with the dice.
An action-packed three day program; not for beginners, this one.
With an advanced group, in a three-day structure, here is how we think about the logic flow. Note, this is not suitable for early-stage or beginners, as you’ll need to move much slower on day one.
13. How much time do you allow for debrief?
Want to good ending? Always allow time for a structured debrief.
Use Miro and sticky notes or structured canvases, but do not skip the debrief.
Debrief, Scale Up! 2022
14. What happens post-program?
Ok, you just wrapped up another great Masterclass. Now what?
How clear is your plan for next steps? Participant survey? Client debrief? Participant debrief? Project work? Real-life slide decks to review?
Be clear, always, on what happens next.
Your turn
ok, so if you are planning to run Scale Up! sessions, this guide can help you better structure and plan the entire workflow.
Good luck!
Bonus: use as much real-life input as possible. Like here, AMZ going public at 3 years old. Why not you?
https://i1.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1768749029655.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2026-02-03 16:56:232026-05-01 16:56:41Facilitator, running Digital Scale Up? Here are 14 questions to help you prepare for a great session
In our work with emerging managers and Fund-of-fund programs around the world, the ‘journey from emerging to institutional-ready’ is a common challenge for many first time fund managers to grasp. We wrote up the story of Nexus VC to show how to start small, start fast and scale a VC Firm into multiple VC funds and, hopefully, maturing into an institutional ready fund. We teach the same in our Fund Manager! Masterclasses
Second article leading up to the upcoming Dune Venture Days in Dubai.
The journey from emerging venture capital firm to institutional-grade investor represents one of the most complex organizational transformations in private markets. It’s not merely about deploying capital—it’s about building a repeatable system for identifying, winning, and supporting exceptional companies while generating top-quartile returns that justify institutional allocation.
A Dubai Story: The Nexus VC Journey
To understand this transition in practice, consider the story of Nexus VC, a Dubai-based early-stage VC firm that made the leap from emerging to institutional over seven years. Founded in 2016 by Chris Al-Mansour, a former corporate VC investor at a regional conglomerate, Nexus’s journey illustrates both the promise and the pitfalls of this transformation.
Chris started with a conviction: the MENA tech ecosystem was reaching an inflection point, with a new generation of founders building scalable businesses that international investors were missing. His thesis—seed and Series A investments in technology companies solving regional challenges with global potential—had worked in his previous role, but he’d always invested someone else’s capital. Building his own firm would be different.
The Capital Structure Evolution
Stage One: Proof of Concept ($500K–$5M)
Nexus’s Genesis (2016-2017)
You only have a few hours, truly, what are you going to focus on?
Chris began where nearly every VC begins: with a small pool of flexible capital. He raised his first $2M fund from a tight network of supporters. The “fund formation” was a simple LP agreement drafted by a regional law firm ($15,000). The “office” was a co-working space membership at AstroLabs in Dubai. The “deal flow” was his personal network and cold LinkedIn outreach.
The earliest capital represents validation, not optimization. At this stage, VC firms are typically operating under sub-optimal structures:
Fund Structure Considerations:
GP commitment usually 1%–2% of fund size (for first fund, often reduced)
Nexus Fund I – The Capital Stack:
Chris’s personal capital: $50,000 (2.5% GP commit, significant for someone in their early 30s)
Former boss at the conglomerate: $500,000
Three family offices: $300K, $250K, $200K
Five HNW individuals: $100K each ($500K total)
Two successful entrepreneurs: $150K each ($300K total)
Total: $2.05M fund size
Operational Reality: The GP is typically wearing every hat—deal sourcing, due diligence, portfolio support, fundraising, back office, and investor relations. Technology stack consists of Excel, a basic CRM, and perhaps a simple data room. Legal work is outsourced to the cheapest responsive firm.
Chris was everything. He sourced deals through founder events, conducted due diligence with Excel models and reference calls, negotiated term sheets, sat on boards, supported portfolio companies, managed LP communications, and handled fund accounting. His “tech stack” was Gmail, Excel, a $50/month Airtable subscription for deal tracking, and DocuSign.
The Investment Strategy:
Check size: $50K–$150K at seed stage
Ownership target: 5%–10%
Sector focus: B2B SaaS, fintech, logistics tech
Geographic focus: UAE, Egypt, Saudi Arabia
Follow-on reserves: ~30% of fund size
First Investments (2017):
Chris moved quickly. By end of 2017, he’d deployed into four companies:
A B2B procurement platform in UAE ($100K)
An Egyptian fintech startup ($75K)
A Saudi logistics SaaS company ($120K)
A Dubai-based HR tech startup ($80K)
Total deployed: $375K across four companies. He’d created a mini-portfolio, but the real work—and uncertainty—was just beginning.
Stage Two: The Inflection Point ($5M–$30M)
Nexus’s Growing Pains (2018-2021)
This is where most emerging VCs fail. The fund is past the friends-and-family stage but hasn’t achieved the scale for institutional attention. This zone represents maximum operational stress per dollar of AUM.
Through 2018-2019, Chris continued deploying Fund I. He made eight more investments, bringing the total to 12 portfolio companies with $1.6M deployed. He reserved $450K for follow-ons and kept $150K for operating expenses (management fees of $41K annually weren’t enough to support operations fully).
Early Portfolio Signals:
Two companies failed outright
Three were struggling and likely to fail
Five were showing decent traction but needed follow-on capital
Two were showing exceptional growth—the Egyptian fintech and the Saudi logistics company
The problem: Chris needed to raise Fund II to follow on his winners, but institutional investors wanted to see realized returns from Fund I. He was stuck in the classic emerging VC trap.
The Infrastructure Build-Out:
At approximately $10M under management, economics begin to support institutional infrastructure, though painfully:
After legal and compliance ($50K–$75K), fund administration ($25K–$40K), technology ($15K–$25K), and events/travel ($40K–$60K), there’s barely enough for one salary
The First Hire Decision:
In mid-2019, as Chris began raising Fund II, he faced his first critical decision: hire someone or continue solo. He chose to stay lean through Fund II raise but made a promise to himself—first hire once Fund II closed.
Fund II Raise (2019-2020):
Chris’s pitch for Fund II:
Fund I portfolio showing signs of life (paper markups from the two breakout companies)
Expanded thesis: earlier stage (more pre-seed/seed), larger fund for follow-on capability
Target: $10M
Same terms: 2.5%/20% with 8% preferred return
GP commit: 2% ($200K, mostly through deferring management fees)
The raise was brutal. Chris pitched 420+ potential investors over 18 months:
Existing Fund I LPs: $3.5M (70% re-up rate by capital)
New family offices: $2.8M (through extensive networking)
Small fund-of-funds focused on emerging managers: $1.5M
New HNW individuals: $1.2M
Total: $11M closed by September 2020
The sovereign wealth fund allocation changed everything. Even though $2M was a pilot check for them, it provided institutional validation that Chris could leverage.
Critical Hires and Sequencing:
The hiring sequence matters enormously for VCs. The optimal path is typically:
First hire (~$10M AUM): A principal/associate who can source deals, conduct diligence, and support portfolio companies—compensation $100K–$150K plus carry participation
Second hire (~$25M AUM): Either a portfolio operations person (platform team) or another investing partner, depending on firm strategy
Third hire (~$50M AUM): Whatever role wasn’t filled in step two, or a dedicated CFO/COO
The First Hire (October 2020):
Chris brought on Daniel Kim, a Korean-Canadian investor he’d met through the regional startup ecosystem. Daniel had spent three years at a larger regional VC and had strong networks with founders and co-investors. Compensation: $110,000 base plus 5% of carry on Fund II (vesting over 4 years) plus 8% management company equity.
Daniel became Chris’s investment partner—sourcing deals, conducting diligence, supporting portfolio companies. The two-person investment team could now cover more ground.
Service Provider Maturation:
This stage requires upgrading from startup-friendly vendors to institutionally acceptable ones:
Fund Administrator: Moving from DIY accounting to a recognized name (Standish, Otter, Carta for smaller funds; SS&C, Citco, Gen II for larger)—cost increases from near-zero to $30K–$60K annually
Auditor: Moving from a local CPA firm to a Big Four or national firm with PE/VC expertise (BDO, Grant Thornton, RSM, or ideally PwC, KPMG, Deloitte, EY)
Legal Counsel: Establishing relationships with dedicated VC fund formation attorneys (Debevoise, Ropes & Gray, Goodwin, Latham, but regionally Dechert or DLA Piper)
Back-office Infrastructure: Portfolio monitoring systems (Carta, Pulley for cap tables; Visible, 4Degrees, or Affinity for CRM)
With Fund II capital, Chris invested in infrastructure:
Hired Otter as fund administrator ($35K annually)
Engaged Deloitte for annual fund audit ($50K)
Retained Dechert LLP for ongoing fund and deal legal work ($100K annually)
Subscribed to Carta for portfolio tracking and Affinity for CRM ($15K annually combined)
Moved into a small dedicated office in DIFC (2 desks, $30K annually)
These costs now came from a larger management fee base ($275K annually from Fund II), but margins remained thin.
Performance and Track Record Building:
At this stage, institutional prospects will begin conducting diligence. They expect to see:
Realized returns (not just paper markups) demonstrating ability to identify and exit winners
Portfolio construction that shows discipline and strategy adherence
Value-add capabilities beyond just writing checks
Network effects and deal flow quality
Co-investor quality as validation
By mid-2021, Chris had meaningful data points:
The Egyptian fintech (Fund I) had been acquired by a regional bank—3.8x gross MOIC in 3.5 years
The Saudi logistics company (Fund I) raised a $15M Series B at a $60M valuation—Chris’s stake marked at 5.2x
Fund I DPI (distributed to paid-in capital): 0.4x (from the fintech exit)
Fund I TVPI (total value to paid-in capital): 2.1x on paper
Fund II was actively deploying with 8 investments made by mid-2021
Can you map out Nexus VC fund II using the Fund Strategy canvas?
Stage Three: Institutional Threshold ($30M–$100M)
Nexus’s Institutional Breakthrough (2021-2023)
Crossing $30M AUM represents an invisible but critical line for VCs. Institutional allocators begin to take meetings. The fund has enough AUM to suggest market validation but isn’t so large that the opportunity set is constrained.
In Q4 2021, with Fund II partially deployed and Fund I showing real returns, Chris began exploring Fund III. His target: $30M–$40M, which would push Nexus firmly into institutional territory.
The Consultant Ecosystem:
Access to institutional VC capital increasingly runs through gatekeepers:
Placement Agents: Third-party fundraisers specializing in emerging managers, typically working for 2%–3% of capital raised with placement fees paid from GP or as an additional LP commitment
Fund of Funds: Aggregators like Horsley Bridge, Greenspring, Top Tier, HarbourVest who can write $3M–$10M checks and provide institutional validation
Institutional LPs: Pension plans, endowments, foundations, sovereign wealth funds with emerging manager programs
Family Offices: Increasingly sophisticated with dedicated alternative investment staff
Chris faced a decision: hire a placement agent or build institutional relationships organically. He chose the latter—partially from conviction that relationship-building was more sustainable, partially because placement agent fees on a $40M fund ($800K–$1.2M) seemed prohibitive.
The Second Hire (January 2022):
Chris brought on Joshua Martinez as VP of Platform & CFO. Joshua had spent five years in VC operations and portfolio support and understood both the investment side and operational requirements. Compensation: $130,000 plus 3% carry on Fund III plus 6% management company equity.
Joshua’s mandate:
Build portfolio support capabilities (recruiting, customer intros, follow-on fundraising support)
Professionalize fund operations and reporting
Support Fund III fundraising with data room preparation and LP reporting
The Third Hire (June 2022):
As Fund III fundraising progressed, Chris hired Malika Khair as Partner focused on Investor Relations and Business Development. Malika had spent eight years at a regional institutional investor evaluating VC funds and had relationships with LPs across the GCC and Europe. Compensation: $150,000 plus 2% carry on Fund III plus 5% management company equity.
Her immediate impact was professionalizing LP communications and opening doors to institutional allocators who wouldn’t have responded to cold outreach.
Due Diligence Intensity:
Institutional VC due diligence is comprehensive and multi-layered:
Strategy assessment: Is the thesis differentiated? Is it sustainable? What’s the competitive moat?
Team evaluation: Track record of individuals, team dynamics, reference checks with founders and co-investors
Operations review: Fund administration, compliance, portfolio tracking, reporting capabilities
Reference calls: Portfolio company founders, co-investors, service providers, other LPs
Scenario analysis: How does fund perform across different outcome scenarios? What’s the path to top quartile?
In Q2 2022, Nexus underwent its first institutional operational due diligence. A $3B European pension fund with a dedicated emerging manager allocation sent a two-person team to Dubai for a week. They:
Interviewed the entire team separately
Called 10 portfolio company founders for references
Spoke with 5 co-investors about Nexus’s reputation
Reviewed all fund documents, side letters, and carried interest calculations
Analyzed deal flow metrics, pass rates, and investment decision-making
Examined portfolio monitoring and value-add frameworks
Assessed fund economics and alignment of interests
The process was exhaustive. Three months later, in August 2022, the pension fund committed €3M (~$3M) to Fund III.
Fund III Fundraising (2022-2023):
Chris’s pitch for Fund III evolved:
Fund I: 2.8x TVPI with 0.6x DPI (two exits realized, three more in process)
Fund II: 1.6x TVPI early, but portfolio showing strong signals
Proven sourcing in underinvested market
Platform capabilities to support companies through scale
Target: $40M with potential to upsize to $50M
Terms: 2%/20% with 8% preferred, improving to institutional standards (quarterly reporting, LPAC formation, key person provisions)
The fundraising took 18 months:
Existing LPs (Funds I & II): $12M (strong re-up rate)
European pension fund: $3M (breakthrough institutional LP)
Two regional sovereign wealth fund programs: $8M combined (both emerging manager allocations)
Established fund-of-funds (Top Tier Capital): $5M (validation from recognized name)
US-based endowment: $4M (first North American institutional LP)
Family offices: $6M (increasingly sophisticated allocators)
New HNW individuals: $2M
Total: $40M final close in June 2023
The fund-of-funds and US endowment commitments were game-changers. Both required extensive diligence, but their presence in the cap table signaled to other institutions that Nexus had arrived.
Terms Standardization:
To attract institutional capital, fund terms must align with market standards:
Management fees: 2% on committed capital during investment period, 1.5%–2% on invested capital post-investment period (some funds use NAV basis)
Carry: 20% remains standard, with 8% preferred return (some institutions push for 10%)
GP commit: 2%–3% of fund size (increasingly enforced)
Key person provisions: if Chris or Daniel left, investment period suspended
LPAC formation: 3–5 seats representing major LPs
Reporting: quarterly detailed reports with portfolio company updates and fund performance
No-fault divorce provisions: LPs can remove GP under certain circumstances
Clawback provisions: ensuring carry is only paid on realized profits
Fund III incorporated all institutional standard terms. Chris and Daniel committed $1.2M combined (3% GP commit), primarily through management fee deferrals and personal capital.
The Destination: Institutional VC Firm ($50M+)
Capital Deployment at Scale
Nexus’s Institutional Operations (2023-Present)
With $40M in Fund III, Nexus operated as an institutional VC firm. The transformation was complete in structure, if not yet in scale.
Deployment Strategy:
Check sizes increased: $200K–$500K seed, up to $1M+ Series A
Ownership targets: 7%–15% at initial investment
Portfolio construction: 20–25 companies in Fund III
Reserve ratio: 40% for follow-ons (recognizing winners early and supporting them aggressively)
Geographic expansion: maintaining MENA focus but open to global opportunities for exceptional founders
The Team at Scale:
At institutional scale, VC teams must professionalize across all functions:
Investment Team:
Managing Partners drive strategy and make final investment decisions
Partners/Principals source deals, lead diligence, take board seats
Associates/Analysts support diligence, portfolio monitoring, market research
Venture Partners/Advisors provide domain expertise and deal flow
By 2024, Nexus’s investment team:
Chris (Managing Partner) – focused on strategy, key deals, Fund IV planning
Daniel (Partner) – actively sourcing and leading investments, 4 board seats
Two Principals hired in 2023 ($140K each plus carry participation) – deal flow and execution
Two Associates ($90K each) – supporting diligence and portfolio companies
12 investments deployed (~$8M), investment period ongoing
Early to assess performance, but initial companies showing traction
Deal flow significantly improved with institutional backing
Exit Strategy and DPI Generation:
Institutional LPs increasingly focus on realized returns (DPI), not just paper markups (TVPI):
Exit pathways: M&A (most common in emerging markets), secondary sales, IPOs (rare)
Active management of exit timing—knowing when to sell vs. hold for next round
Secondary market solutions for liquidity before traditional exits
Engaging with investment banks and corporate development teams early
Chris and Daniel actively worked exit opportunities:
The Fund I logistics company had become a unicorn ($1.2B valuation in 2023). Chris faced a decision: sell secondary stake (5x–6x) or hold for potential IPO (10x+ but uncertain timing). After LPAC consultation, he partially exited (50% of position) in a structured secondary, generating meaningful DPI for Fund I while retaining upside.
Two Fund II companies received acquisition interest from larger strategics. Chris negotiated exits at 4x and 3.5x MOIC respectively.
By 2024, Fund I was approaching final distributions with strong returns. This performance became critical for Fund IV discussions.
The Critical Success Factors for VC Firms
Performance and Track Record
Institutional VC investors evaluate firms on multiple dimensions:
Gross and net returns: Top quartile benchmarking (need 3x+ net MOIC for top quartile in most vintage years)
DPI generation: Actual cash returned to LPs, not just paper gains
Competitive win rate: 75% of term sheets accepted (high for region)
Portfolio support: 85% of portfolio companies reported Nexus as helpful or very helpful in annual survey
Follow-on signaling: 90% of Nexus portfolio companies that raised follow-on rounds received additional Nexus capital
Team Quality and Stability
LPs invest in teams, not just strategies:
Track record of individuals: What have they built or backed before?
Team dynamics: How do they work together? Is there alignment?
Retention: Has there been turnover? Are people locked in with golden handcuffs?
Succession planning: What happens if the founder leaves?
Diversity of thought: Different perspectives and backgrounds strengthen decision-making
Nexus’s team stability:
Zero turnover in core team (Chris, Daniel, Joshua, Malika) over 6 years
Management company equity: Chris 65%, Daniel 12%, Joshua 8%, Malika 7%, option pool 8%
Carry allocation clearly defined across funds with vesting structures
Decision-making process documented: Chris and Daniel both had veto rights on investments, but decisions made by consensus
Succession: Daniel capable of leading firm if Chris unavailable
Deal Flow and Market Position
Sustainable deal flow is the lifeblood of VC:
Founder networks: Do great founders come to you first?
Co-investor relationships: Do top firms want to co-invest with you?
Brand in market: Are you known for specific expertise or value-add?
Geographic or sector moats: Do you have differentiated access?
Platform capabilities: Can you help companies beyond just capital?
Nexus’s market position (2024):
Recognized brand in MENA tech ecosystem—founders sought Nexus out
Strong co-investor relationships with international tier-1 VCs (Sequoia, Accel, Index, others) who valued regional presence
Domain expertise in fintech, logistics tech, B2B SaaS recognized by founders
Platform capabilities (recruiting, sales intros, fundraising support) differentiated from pure-play capital providers
Chris and Daniel both regular speakers at regional startup events, active on social media, published thought leadership
Alignment and Economics
LPs scrutinize fund economics rigorously:
GP commit: Is GP capital at risk alongside LPs?
Management fee structure: Are fees appropriate for fund size and strategy?
Carry structure: Is carry aligned with LP returns (hurdles, catch-up provisions)?
Conflicts of interest: Side vehicles, SPVs, management company conflicts?
Transparency: Are fund economics clearly communicated?
Nexus’s alignment:
GP commit: 3% across all funds (Chris and Daniel’s personal capital at risk)
Management fees: 2% committed capital during investment period, reducing to 1.75% on invested capital (lower than many peers)
Carry: 20% with 8% preferred return, subject to clawback
No side vehicles or management company conflicts
Full transparency on fees and expenses in quarterly reports
The Institutional Mindset Shift
The transition from emerging to institutional VC isn’t just operational—it’s philosophical. Emerging VCs optimize for access and survival. Institutional VCs optimize for repeatable process, portfolio construction, and sustainable returns.
Chris’s Reflection (2026):
In a conversation with a prospective emerging VC seeking advice, Chris reflected on the journey:
“The hardest lesson was learning that being a good investor doesn’t make you a good fund manager. They’re different skills. In the early days, I thought if I just picked good companies, everything else would work out. But institutional investors don’t just want good picks—they want evidence of a repeatable process, proof that you can do it again and again.
That meant formalizing everything. Our investment memos went from 3-page Word docs to 25-page structured analyses. Our portfolio monitoring went from ‘check in with founders’ to quarterly board meetings with KPI tracking. Our fundraising went from begging for meetings to LPs calling us.
The other big shift was time horizon. Emerging VCs think fund-to-fund—’I need returns from Fund I to raise Fund II.’ Institutional VCs think in decades—’How do we build a multi-generational firm?’ That changes how you think about team building, portfolio construction, and market positioning.
And honestly? The economics compress. Fund I, when it was just me, I probably cleared 70% margins on management fees after minimal costs. Fund III, with a team of 11 and real infrastructure, we’re running at 35%–40% margins. But it’s a bigger base, the business is sustainable, and we’re not dependent on me not getting hit by a bus.
The valley between $5M and $30M under management is where most VCs die. You’re too big to run lean, too small to afford infrastructure. You need returns from your early funds, but those take 7–10 years to materialize. It’s brutal. We survived because we stayed disciplined, hired intentionally, and always thought about what institutional LPs would require—even when we didn’t have institutional LPs yet.”
This means:
Building repeatable processes over gut-feel investing
Accepting that team building and operational excellence matter as much as deal picking
Recognizing that LP management is a continuous relationship, not transactional fundraising
Understanding that reputation in VC compounds exponentially—one ethical lapse or major failure can close doors permanently
Conclusion: Building for Permanence
The emerging VCs who successfully transition to institutional status share common traits: they treat venture capital as a business, not just a series of bets. They invest in team and infrastructure before they absolutely need it. They build relationships with LPs as true partnerships, not just capital sources. And they recognize that institutional VC capital is patient and sticky—once earned, it provides a foundation for building a multi-decade franchise.
Nexus’s Future (2026 Outlook)
As of January 2026, Nexus VC manages $53M across three active funds (Fund I largely distributed, Fund II partially realized, Fund III actively deploying). The firm is preparing to launch Fund IV with a target of $75M–$100M, which would firmly establish Nexus as a institutional-scale regional VC.
Chris, Daniel, Joshua, and Malika have built something that transcends any individual. The firm has institutional LPs who view Nexus as a core emerging markets allocation. The team has depth and succession planning. The deal flow is sustainable and differentiated. The portfolio is generating real returns, not just paper markups.
The journey from Chris’s co-working desk to a $100M institutional VC took nine years (including Fund IV raise), three key hires, hundreds of rejected pitches, and a willingness to professionalize every aspect of the business. It’s a journey hundreds of emerging VCs attempt every year. But as Chris learned, getting from $2M to institutional scale isn’t primarily about picking winners—every VC believes they can do that. It’s about building an organization that institutional fiduciaries trust with their capital.
The hard part, Chris often reflects, wasn’t raising the first fund—friends and family believed in him personally. And it wasn’t deploying capital—there were always companies to invest in. The hard part was the years between Fund I and Fund III, when he had to build real returns, hire a team, professionalize operations, and convince skeptical institutional LPs that a regional, emerging VC deserved their attention.
But for those who survive the valley, who build the track record, who invest in team and process, who treat LPs as true partners—there’s a path from emerging to institutional. It’s not easy, it’s not quick, but it’s possible.
And on quiet mornings, when Chris arrives at the Nexus office before the team, he sometimes thinks back to those early days in the co-working space, cold-emailing founders and begging for investor meetings, wondering if he could really build a firm. The answer, it turned out, was yes—but only by building something bigger than himself, something that could endure beyond any single fund or investment cycle.
The emerging VCs who make it don’t just pick good companies. They build great firms. And in venture capital, the firm is the ultimate product.
The story of Nexus VC is fictional, but based on 100’s of conversations with emerging managers across accelerators, masterclasses and GP coaching sessions.
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https://i0.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1769790810083.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2026-02-03 16:43:222026-05-01 16:44:54The story of Nexus VC – From Emerging to Institutional Venture Capital: A Technical Roadmap
