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How Tribe Capital selected and ranked the 2023 Seed 100 and Seed 30 lists of the best early-stage venture capitalists

Jake Ellowitz, Tribe Capital   

How Tribe Capital selected and ranked the 2023 Seed 100 and Seed 30 lists of the best early-stage venture capitalists
  • Insider's Seed 100 and Seed 30 lists are created based on data from Tribe Capital.
  • Tribe began with data on over 1,600 investors, analyzing 25 attributes of success, such as exits.

The Seed 100 and Seed 30 lists of the best seed investors of 2023 are derived from a statistical analysis of investor track records. This analysis is adapted from the models Tribe Capital uses internally to identify the most promising seed investors for partnership.

The point is to identify investors with extraordinary skill and a high likelihood of continued success. To be named to the list, seed investors must:

  1. Perform well with investments, including successful initial public offerings or acquisitions (exits meaningfully above "liquidation preference," aka ones that demonstrated increased company value, rather than simple capital raises).
  2. Show intermediate signs of success, with seed investments that consistently receive material sums of follow-on investment.
  3. Be active in the ecosystem, with moderate to high levels of seed-investing activity over the previous two years.

Our methodology starts with analyzing each investor's performance in 25 areas using Crunchbase and PitchBook data. Since our goal is to predict accomplishments, rather than to focus solely on achievements, we consider only active investors with a minimum of five investments between 2008 and 2023. Our list includes solo venture capitalists and angel investors worldwide, assessed based on their investments in US companies.

While each criterion carries equal weight, exits (IPOs or acquisitions) have the most influence in differentiating investors. Given that seed investments typically take seven to 10 years to exit, our analysis covers an extended time frame.

This year, we updated the model to better approximate the rate at which investments were exiting. We also reduced the penalty for lower investment counts — given the current, slower dealmaking environment compared with earlier years. This also allowed more emerging managers to enter the scope.

To earn a spot, at any ranking, on this list is an achievement. Our candidate pool began with over 1,600 investors, a 15% increase from last year's Seed 100 list. The final ranking included 45 new investors, 33 who improved their rank, and 22 who've been on the list more than once.

Women and the Seed 100

That said, we recognize that many great investors aren't on these lists. Because the point of investing is to realize returns, our model looks at both funding activity and exits. And because it typically takes years before a seed investment shows signs of success, or matures to a prominent exit, it takes years to gauge the quality of an investor's track record.

Now add in that venture has a long history of being a white-glove industry, with dealmaking very dependent on networks — aka whom you know — and has historically largely overlooked women.

That's starting to change and is one of the problems our data-driven approach to investing is designed to solve. That's why, in addition to the Seed 100, using the same methodology, we have crafted the Seed 30 of the best women seed investors.

Still, by relying on historical analysis in our model, especially results, our list reflects the difficulties women face. As more women grow their venture careers and sign more deals, and those deals mature to the point where our analysis can measure them, more women will be named among the Seed 100 list ranks.

In just the three years we've been doing the Seed 100 project, we've seen our ability to measure the success of more women grow significantly. In our previous two years, the list of women investors we could, with high confidence, name as the best was capped at 25. This year, with hundreds of women in the 1,600 investors we analyzed, we had enough data to grow that list to 30.

The fundraising environment

We also want to note that the 2023 list comes at a time when the venture-capital industry is operating very differently than in years prior. Tribe Capital created what we call a "Weather Report" to gauge capital supply and demand so we can plan for the future. We're in a fundraising desert, and our indicators show that we're only about one-third of the way through this dry patch, with an estimated 18 to 24 months remaining.

Interestingly, though, seed investing has proved largely acyclic. Seed-stage companies are designed to operate leanly, as many are often generating little to no revenue while they build their first products and work on their sales and business-model strategies. Harder-hit are the later-stage companies whose strategies are influenced by available capital. (For more on venture macro, see our research "Crossing the Desert" and "A Record Shortage of Venture Capital.")

Artificial intelligence is another area of influence, particularly the potential of large language models, such as the kind used to create ChatGPT. Many seed-stage companies are reorienting their product strategies around LLMs, using them to augment engineers and workflows, or as technical infrastructure to scale products. We predict that time to market for products will shrink and more value will accrue at the earliest stages of companies than before. As a result, the opportunities for seed investing, and the investors themselves, will grow in volume and diversity.

Jake Ellowitz is a partner at Tribe Capital and the data scientist who pioneered Tribe's mathematical models for the startup and venture-capital industries.

Also read: Everything you need to know about the best early-stage investors named in the Seed 100 and Seed 30 lists



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