A Better Way to Venture: Founder-Aligned VC Meets PE Style Execution

By Nate DaPore, Founder & Managing Partner, Roo Capital

Two years ago, it was still mainstream to think that venture capital could defy gravity. Capital was cheap, exits were frothy, and the power law portfolio theory (writing a lot of early checks, hoping for one or two unicorns to realize) dominated the market. Then reality caught up.

Global venture funding fell nearly 40% in 2023 to about $304B and clawed back only modestly to about $314B in 2024 (1), mostly driven by headline-grabbing AI mega-rounds. Yet this was still roughly 40% below the 2021 peak, according to Crunchbase. The hangover has rolled into 2025 with seed-stage deal counts down 28% YoY, dollars raised down 37%(3). 

Beyond macroeconomic factors, a significant driver is uncertainty over how their capital is being deployed and the strategy behind it. Capital alone is no longer a competitive advantage for VCs – it's become a commodity in venture. Founders know it, and LPs know it.

Embracing the Private Equity Playbook for Venture Capital 

Private equity investors have long understood that returns come from building companies, not betting on momentum. Their toolkit, which includes hands-on operating partners, functional playbooks, and disciplined governance, is precisely what startups need as capital tightens. 

Unsurprisingly, venture is converging toward a similar model. According to the VC Platform’s Global Compensation and Insights Report (5), funds with embedded value-creation teams delivered +1,100 bps improvements in net IRR and +0.5× TVPI compared to peers, evidence that value-add capabilities pay.

The market is catching on, with firms like Andreessen Horowitz and Insight Partners incorporating value-creation arms that now match their investing headcounts. These are structural re-tools designed to win deals when founders ask, “How will you actively help us scale, especially around go-to-market execution and removing roadblocks, not just introductions for our next round?”

Roo Capital’s Proprietary Value Creation Model: Capital + Talent + Growth

Value creation has been the core principle behind Roo Capital since day one, guiding how we help companies unlock their full potential. We’ve built a proprietary early-stage venture model that integrates two specialized value-creation arms deployed within the first year of investment: Roo Search and Roo Growth. Roo Search, our recruitment arm, partners with founding teams to build high-performing leadership teams that are aligned with the company’s vision, culture, and stage of growth. Roo Growth is our in-house operating team, staffed with private equity-trained professionals who work alongside founders to execute targeted go-to-market 

strategies, identify key scaling levers, and pursue strategic growth opportunities that establish durable market leadership and build competitive moats. 

Roo Search has filled 30+ mission-critical roles (e.g. CROs, VPs, Engineers) across our current 10-company portfolio in under 18 months. Meanwhile, the Roo Growth team has been instrumental in driving value creation, GTM initiatives, and strategic acquisitions to accelerate growth for our portfolio companies and deliver meaningful enterprise value creation.”

Why the Best Venture Returns Start with the Right Network 

One of the most compelling indicators of early-stage venture success is who’s around the table from Day 1. According to a recent PitchBook study (Feb 2025), companies led by well-connected investors at the Series A stage delivered annualized returns of 33.1%, compared to just 12.6% for those led by peripheral investors. The trend continues through Series B and C, with even more pronounced disparities at Series D and beyond. This confirms what elite founders and institutional LPs have long suspected: networked capital materially outperforms capital alone.

At Roo Capital, we’ve institutionalized that advantage through Roo Search, our proprietary 21,000-person executive database developed from years of search work for VC and PE firms outside of Roo Capital that continues to this day as a best-in-class search firm. This platform doesn’t just support our portfolio companies with A-list talent, it also powers our sourcing engine, helping us identify and back breakout companies like GoTu, Scamnetic, and Steer earlier and with higher conviction. These are not companies we stumbled into, they are companies we helped build, scale, and professionalize, leveraging talent and operational playbooks from day one.

This is the foundation of Roo’s model: Capital + Talent + Growth integrated into a disciplined, high-conviction investment strategy. Our operating depth and strategic network are not just differentiators; they validate the return premium that PitchBook’s data reveals and are core to how we drive performance and generate real enterprise value. As the gap between active and passive capital continues to widen, Roo’s hands-on, founder-aligned approach offers Founders & LPs a more durable and proven path to early-stage outperformance.

Here’s Where Smart Capital Is Headed

For founders, operationally engaged capital is an accelerant, not a distraction. The best entrepreneurs now reference-check VCs on execution support with the same rigor they once reserved for valuation negotiations when seeking out a VC partner. For LPs, we’ve seen that firm depth of portfolio value creation sits alongside track record in due diligence. In a market where exits arrive later and mark-ups are scarce, hands-on value creation is the surest way to protect and compound capital.

Will venture ever look exactly like private equity? No. Speed, risk tolerance, and technology disruption will always differentiate early-stage investors from PE. But the direction of travel is 

unmistakable: the firms that combine early-stage agility with PE-grade operational muscle will capture the highest-caliber founders and the most durable returns. Those clinging to a capital-only playbook and reliance on their ‘Rolodex’ of connections only risk being left behind.

Roo Capital - What the new VC model looks like.

A key difference in approach is that traditional PE firms drive returns through financial leverage and cost-cutting, while Roo’s strategy centers on value creation through hands-on partnership. By integrating capital, executive search, and GTM acceleration, we deliver a people-first model designed to unlock scale efficiently and early.

We’ve built a model that’s working, and the outcomes across our portfolio show just how powerful Capital + Talent + Growth can be for founders & LPs. 

Nate DaPore | Founder & Managing Partner