How Motivate Ventures leverages Fund Forecasting to automate fund planning and management workflows

Motivate Venture Capital is a pre-seed and seed investor focused on fintech and enterprise software builders. Headquartered in Chicago, MVC Fund I launched in 2019 to support entrepreneurs with foundational capital at the earliest stages of their companies’ lifecycle.

Currently investing out of Fund II, Motivate builds deep relationships with its founders, actively supporting them with capital, connections, and operational guidance on their journey from idea to exit.

Motivate VC, like most other funds, initially built its fund model in Excel but faced numerous challenges when it came to updating and maintaining the model. Challenges with data integrity, version control, and modeling different outcomes were issues with the Excel-based process.

“Running a $40 million fund on Excel just did not seem sustainable,” said Lauren DeLuca, co-founder and general partner. “As we were gearing up to raise our second fund, we wanted to improve our modeling capability, how we forecast upcoming rounds, how we scenario plan, and how we forecast capital calls.”

Realizing the need for a better and more scalable solution, Lauren sought out an alternative and found Fund Forecasting.

“Fund Forecasting was light years ahead of our prior Excel-based solution, or anything we had seen in the market,” he said.

Why Motivate selected Fund Forecasting

“Motivate was connected to Fund Forecasting by a referral and as soon as we saw it it immediately resonated…Fund Forecasting was clearly built specifically for venture capital managers,” he said.

“Fund Forecasting takes you through a quick but very flexible construction wizard to build your initial construction model,” he added. “Then as you deploy capital, you add in each investment along with a set of performance cases and you now have a real-time fund forecast and view of expected performance. You can quickly slice the data for added insights and run scenario analyses in minutes to stress-test your model and evaluate potential strategy shifts.”

One of the key selling points for Motivate was also the market data aspect —the firm always depended on market data by stage and industry, but Fund Forecasting gave it the flexibility to access current market data quickly.

How Motivate implemented Fund Forecasting

“The customization aspect has been great and it’s really easy to use,” Lauren said. “I did not want to take months and months trying to figure out a software. I wanted it to be completely intuitive and that’s Fund Forecasting to a T.”

He added: “The other thing is that from a customer support perspective, the entire team has been phenomenal. They are very connected to the user base and responsive with ongoing feature updates.”

Where Fund Forecasting really shined for the Motivate team was the ability to operate from a place of transparency with planned and actual investments. The whole team could see the strategy and pacing analysis, all with a forward-looking view of what investments need consideration for follow-ons and when they are likely to need them.

“Alongside our CRM, Fund Forecasting is by far the most used software in our fund,” Lauren said. “We use it every day. We now have a crispness and confidence in exactly how much capital we need to deploy over what time period, what funding activities are coming in the near term, when we need to call capital, etc. We have more data-driven decision making and that is very powerful.”

“We have also incorporated the market data into our workflow. If I’m evaluating a later-stage follow-on opportunity in one of our companies, I like that I can look at its competitors’ raises as part of the evaluation.

The flexibility afforded by Tacytc is equally key. “It is really hard to model different outcomes in spreadsheets and scenario modeling is a huge part of what we do,” he said. “ Fund Forecasting enables scenario planning so easily.”

Transparency, Lauren said, has been a very powerful leveling up with Fund Forecasting. “The full team understands our fund strategy and has absorbed it, in part because they can see it and how it’s expressed in Fund Forecasting. They can see what we’ve done and why, what the portfolio looks like today, exactly how much money we have left and the cadence of how we should invest those funds. They can see how the fund is performing. It is important to us that the team is not just operating in the dark and they in turn really enjoy that transparency.”

That transparency yields a variety of benefits, opening up new visibility, Lauren said. “Fund Forecasting helps the team know what to work on in some ways—they can see what rounds are coming and which companies likely need to raise. It has also been very helpful for reporting internally and helps hold us accountable.”