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Hey folks how interview and onboarding process happen in HCL Technologies i have a notice period of 90 days and cleared all the rounds had my salary discussion what next ?
After salary discussion how much time usually HCL Technologies take to release offer i am asking because i am waiting for the offer letter so that I can resign.
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I don’t think you need to quit your day job right away. I’d do everything possible to delay that until you absolutely have to.
$50M is pretty normal starting point tho. From my experience that seems to be the pretty standard minimum size for a “2guys and a laptop” fund.
You’re looking at $1m as your operating budget for the fund, assuming the standard 2 & 20 model in VC.
20 is the % of profits that the VC gets above a certain threshold of profits. Don’t worry about that for now.
As VCs you’ll charge LP’s 2% of AUM as an annual administrative/management fee. Being small/new you might be able to get 3-4%. But I’d be pretty judicious about that. There are plenty of ways you MIGHT be able to convince the LP’s to take on more of the administrative overhead costs, but let’s just be conservative and assume you’re looking at $1m. That’ll need to cover any costs associated with running the fund. So how many people are going to be involved in running the fund? If it’s really just you then your salary is $1m minus all other costs.
To get a sense of what those costs are theres plenty of industry reports that show the admin fees behind running a fund.
Personally, I’d be budgeting max of $250k as my comp and ring fencing 50% as min op-ex. Spend big on marketing/diligence and being everywhere in the market that first year. If you’re living in a LCL country then you can get by on much less.
The real money here is going to come via carry on your winners. Don’t hamstring the fund performance by taking a big dip for yourself.
You’re a new fund so you’re going to have to work harder and spend more to get noticed and find deals.
I can refer you to a firm that can offer good back office / controller services and shadow accounting. There are quite a few out there…
If I were you, I’d push very hard to ensure that you are finding credible professional services to augment staff and provide tight financial controls. That’s #1 and if the fund is bringing you in to be the “leader” then you need to protect yourself from becoming a “fall guy”.
Pay for quality tax/accounting/legal. Don’t use people that your buddy knows in country. Go to any top50 firm in America and they’ll have some sort of partner in country. I would want to be paying a US firm (or whatever locality you reside in), even if they are outsourcing the work to a local. It’s about preserving some power for you. You’ve got to be able to have some allies/advisors you can trust who are loyal to you.
Don’t use your buddy’s contacts in banking or professional services…If you make this mistake, then his family will own you. If you are leading you get to make those decisions.
Go through US Dept of Commerce and have these LPs and your buddy’s family/businesses checked out before you start. This will cost you a couple grand but it’ll be worth it.
Document everything. Make sure that you have investor reporting figured out before you take $. Keep it as simple as possible. Don’t allow for a complicated cap table.
In a nutshell, I’m trying to urge you to go above and beyond to be well organized and show them from the start that you aren’t going to cut corners. If they are legit, they will look at all of this as a sign that you know what you’re doing and a valuable asset.
If they don’t go along with this kind of stuff then, I think you have to start questioning things. If you’re going to lead then you need to be able to lead.
For me, I’d always be willing to take less cash in comp if it meant generating high performance and reduced headaches.
A day will come at some point when all of this will actually matter and you’ll be glad you did it.
Some other questions…
Are the funds actually committed or verbal? Is the guy recruiting you willing to take less or equal pay than you? When would you move there?
What’s the investment thesis ? Is the fund only investing in-country?
Sounds like a fun opportunity and happy to chat more.
These are amazing insights - I’ve saved down this post and read through it a few times. Points on prioritizing American financial services partners make sense but would not have been intuitive to me.
As to a few of your other questions - these would be in-country investments and I have some time to decide, likely up till EOY 2022. The Covid situation still hasn’t been resolved here. Right now, still in verbal commitment stage, but would say of the things I am skeptical about, I’m not skeptical about his ability to close capital nor his current intentions (we’ve been close for 10+ years). I would love to loop back with you as things move along.
The other partner isn’t in it for the money, at least in direct sense. He’s just exited a business his family owns with a megafund, is the direct heir to the family’s assets, and sees this as a mechanism to further elevate his legitimacy and quite literally make the parents proud. A happy outcome for him would be a reasonable return on capital he’s invested himself, but more importantly a legitimate brand/business (e.g., ability to raise fund II) in a way he can say was of his own initiative.
My question is what is the game you are being asked to play and is it winnable?
Are you managing the operations? The investments? Growing the AUM/fundraising?
In short, how will they measure success?
If you have no experience running or even working at a fund it might be a very steep learning curve.
Also, for them, if it doesn't work out, they replace you and you left the Partnership and are looking for work and they will brush it off and still be the richest people around.
I have 0 experience running a fund. I worked at a MM PE shop for a year a long time ago, but have been otherwise focused on growth strategy and tech for most of the last 10 years.
My understanding is that key benchmarks in the first year will be about effectively spending the money, as $50M is substantial AUM for this country. The “legit” startups tend to be crowded trades and shy to foreign capital while there are many seedy companies that are bull shit or even borderline fraudulent. The thesis pitched to me was that co-investing with a local who knows which people are legit added to a partner with good tech/operator experience from what they would consider a prestigious background could be a winner…
Of course, I don’t have a good bull shit detector here. I don’t see any incentive for ill intent but I would only sign up if the economics made sense or if there’s a real opportunity. I guess at this stage, I don’t even know what an unreasonable ask would be… like what’s a reasonable carry ask for a 2 man shop for a fund of this scale?
Coach
Not my domain at all, but how much money can you reasonably expect to earn when AUM is only $50M?
Was top of mind for me too - I’ve heard growth rates for startups here at just ludicrous…
But that’s part of the question. Apparently $50M is a very respectable size for a new fund in this area. I don’t know what a reasonable ask is.
Do you have experience in the region? Can you refer me? 😉 I’m from south east Asia living in the US right now.
Lol which country
Set it up in Singapore, you’ll be fine from a language perspective. Lots of VCs in Singapore investing across the region- check out the Hustle Fund
Which country? Indonesia?
What do you have to lose? Sounds like a fun and good experience. Worse case you can come back! My advice, don’t focus on short term financials rather on what you will learn
Take me with you. Seriously.
I set up and managed a USD30-50Mn AuM fund about 10 years ago. DM me if you wan to know more.