Anatomy of a VC AGM
November is AGM season for many VCs. It’s the time of year when venture capital firms all over the world hold their “Annual General Meetings.” But what is a VC AGM and what do VCs tell their investors behind closed doors?
An annual general meeting is a meeting held once each year for all of the investors in a company. In the case of VC firms, those investors are referred to as “limited partners” (LPs). The AGM is an opportunity for all of the VC’s LPs — irrespective of the size of their investment — to hear from the firm’s leadership and ask questions of the partners. AGMs are historically held in-person, though online/hybrid meetings have become commonplace post-Covid. In the case of Panache Ventures, we hold our AGM in-person each year in Montreal (where our firm is based) but also stream it online for LPs who aren’t able to join us live.
VC AGMs typically consist of three sections:
An LPAC-only component (the “LPAC Meeting”)
A component open to all of the LPs in the firm
A component open to both LPs in the firm and select invited guests
The LPAC Meeting(s)
Most VC funds have an advisory committee comprised of representatives from the largest LPs in the fund, called the “Limited Partner Advisory Committee” (or LPAC). In many respects, the LPAC serves a governance roll similar to that provided by a typical company’s board. For firms that operate multiple funds, like Panache Ventures, there is one LPAC per fund. Each LPAC is responsible for representing the interests of all of the LPs in the particular fund that they’re advising.
The partners of the firm meet regularly with each of their LPACs — typically once per quarter — to provide an update on the firm’s operations, seek feedback and advice on new strategies and discuss sensitive matters. In addition, certain actions require approval from the LPAC, such as investing more than a threshold amount into a single company. The LPAC meeting that is held alongside the AGM often has a “year in review” component to it, in addition to the standard agenda items.
The LP Meeting
The “main event” at a VC’s AGM is a closed-door meeting for investors in one or more of the firm’s funds. The LP meeting generally includes the following topics:
Financial and performance updates on each fund that the VC operates
Spotlights on the best performing companies in each fund (the companies that are likely to have the biggest impact on the fund’s overall performance)
Non-public updates on portfolio companies that have successfully raised new funding rounds
Detailed introductions to some of the companies that the VC invested in during the year
Macroeconomic updates (what is the VC’s perspective on macroeconomic trends)
Lessons from the previous year / predictions for the coming year
Operational updates (team updates, infrastructure, etc.)
Updates on firm strategy and future funds
Open Q&A with the firm’s partners
A typical LP meeting will range from 1 - 3 hours, depending on how many funds the firm operates.
The “Public” Meeting
After the LP meeting ends, many VCs hold an event that is “open to the public” (i.e. key ecosystem partners and potential future LPs are invited to join current LPs). This third section is the opportunity for the firm to show off some of its portfolio companies and market the firm to a broader audience of investors.
The public meeting typically focuses on showcasing the best founders in the portfolio. In some cases, individual founders give talks or fireside chats with one of the firm’s partners. In other cases, a firm might present panels of founders and/or subject matter experts. At Panache’s AGM, we typically invite groups of founders from sectors that we’re particularly excited about to discuss their companies and the state of their industry.
Discussing the future of AI with the founders of Kicker, HumanFirst and Reworkd
Many VCs also invite high-profile “headline speakers” to give keynote talks in order to show off the influence of the firm. In contrast, some VCs philosophically prefer to stick to their portfolio.
After that, there’s almost always a post-AGM networking event for the VC’s employees, LPs, portfolio founders and invited guests to mix and mingle.
