Apr 1, 2025

Writer Expected time to read 3 min In a market increasingly defined by a “rush to quality,” venture capital firms are finding it harder than ever to win the most competitive deals. With fewer standout startups raising money and those that do often commanding sky-high valuations, VCs are under pressure to evolve. We’ve seen startups like Clickhouse go from a $50 million Series A to a $250 million Series B at a $2 billion valuation in just months. That kind of velocity creates intense competition, pricing many firms out and leaving some stuck as “zombie funds” – still managing existing portfolios but no longer actively investing. So how can VC firms remain relevant and win in this environment? Here are five ways to set them apart and remain competitive. 1. Expand beyond traditional portfolio areas In the search for high-quality opportunities, VCs are being pushed to rethink their investment theses. Traditional software bets are no longer the only game in town. We’re seeing increased interest in underexplored sectors like materials science and energy – industries which were previously overlooked but are now enabled by advances in AI, automation, and deeptech. Expanding into new verticals not only opens up fresh deal flow but also positions firms as forward-looking and willing to back what’s next, not just what’s worked before. 2. Deliver platform value that goes beyond capital Every founder expects the basics: network introductions, strategic mentorship , and financial support. The real differentiation lies in what VCs can offer beyond the table stakes. Adding platform value might mean giving founders access to hard-to-reach technical and executive talent, deep industry connections, or domain expertise that fills gaps in a founder’s knowledge. Firms with global reach can offer startups a powerful edge: local insights and networks in key markets which are especially valuable to founders building with global ambition from day one. Ultimately, the VCs who win the most competitive deals are the ones who consistently deliver what founders truly need and can’t find elsewhere. 3. Build a global network For founders with global ambitions, local capital isn’t enough. VCs with cross-border reach are uniquely positioned to help startups expand into new markets, navigate regulatory environments and plug into new customer bases. Global networks also enable syndication with international investors, helping startups raise larger, more strategic rounds. It’s a powerful edge – especially for founders with the ambition to build a global company from the early stage. 4. Leverage media and brand to build influence VC podcasts like ‘20VC’ in Europe and ‘All In’ in the US have shown that media is more than just marketing – it’s a moat and it elevates their influence. By building trusted, founder-facing brands with these large audiences, they’ve increased brand awareness and their reach for hiring announcements, portfolio wins, thought leadership, and access to the next generation of top founders. In a world where reputation is everything , those who show up consistently and authentically stand out. 5. Keep your word At the end of the day, the best founders do their homework. They talk to other founders and they care about how a VC behaves after the term sheet is signed. Speed, transparency, and true partnership matter more than ever. VCs who deliver on promises, stay close to founders in hard times, and move decisively will continue to earn a seat at the table. A market that rewards the bold Despite increased competition, VCs can be optimistic when looking ahead to the rest of 2025. The European market regained momentum in Q4 of last year, with the UK securing the highest levels of investment across the region. For VC firms to capitalise on this momentum, agility and innovation are key. Those who adapt to the shifting landscape, embrace diversification and offer unique value will be best placed to stand out and secure high-quality investments in competitive funding rounds. Firms that consistently deliver real value to world-class founders are set to benefit the most. For more  startup news , check out the other articles on the website, and  subscribe  to the magazine for free. Listen to  The Cereal Entrepreneur  podcast for more interviews with entrepreneurs and big-hitters in the startup ecosystem. Share This Article