with Marc Penkala, General Partner at āltitude
EUVC Academy · 1h 16m · Fund Modelling
Part of Fund Modelling Series
The assumptions sheet is the backbone of any VC fund model. It defines how the model behaves and ultimately shapes the outcomes it produces.
This session focuses on how to construct and structure the assumptions layer in a way that reflects real-world fund dynamics. It breaks down the key categories of assumptions, how they interact and how small changes at the input level can materially impact performance. The goal is to build a clearer understanding of how to design, evaluate, and stress test a fund model from the ground up.
Key Learning Points
Assumptions as the foundation of the model
The assumptions sheet defines how the entire fund model behaves
Strong assumptions enable downside protection, not just upside projection
Model quality depends more on inputs than on technical complexity
Core fund assumptions and structure
Fund size, fees, term, and deployment define the model’s boundaries
Fee structure directly impacts deployable capital and outcomes
Drawdowns and fund timing shape both LP experience and performance
Round dynamics and valuation logic
Round sizes and valuation step-ups drive portfolio evolution
Entry valuations have a direct and significant impact on returns
Ownership, dilution, and check size must be internally consistent
Asset development and fund return potential
Modelling a single asset lifecycle reveals if a strategy can return the fund
Timing of investments determines whether assets can reach full maturity
Some strategies only work if executed early within the fund lifecycle
Strategy, scenarios and key levers
Entry vs follow-on strategy can materially change fund performance
Small changes in assumptions can create large outcome differences
Scenario analysis helps identify which variables matter most
Fees, discipline and model robustness
Fees reduce available capital and meaningfully affect outcomes
Cost discipline can increase deployable capital and improve returns
Robust models are built through iteration, testing, and refinement
Simplicity, communication and LP alignment
Most LPs will not engage deeply with complex models
A clear dashboard is essential to communicate strategy effectively
Simplicity improves understanding and decision-making
