Pillar
Cross-Fund Concentration
A firm with three funds, each diversified inside itself and each concentrated in the same sector, has a firm-level concentration no fund-level view catches. Every individual fund looks fine. Nobody chose it, and it is invisible from where most reporting is done.
5 pages
- How much of your firm sits in one sectorA firm's largest sector, read against the scope it declared to LPs. Why the mismatch matters in both directions, and how scope is resolved when two funds describe themselves differently.
- How much of your firm is riding on one companyHow much of a firm's deployed capital sits in one company across every fund it runs, why the exposure accumulates without anyone deciding it, and why each large position is counted as its own flag.
- When concentration is a strategy rather than a problemConcentration that accumulates without anyone choosing it is a finding. Concentration a firm chose on purpose and told its LPs about is a strategy. Why that distinction decides which patterns are worth flagging.
- Reading concentration when you only have one fundA firm with one fund gets the same reading as a firm with four, and it is the case where the reading is most useful, because most of the capital that would change it has not been deployed yet.
- Why the venture concentration headlines say nothing about your firmThe venture industry's concentration story is about the market. Your own concentration is about how your capital is spread across the funds you run. The two share a word, answer different questions, and only one of them is a position you can change.
How to read this engine
Cross-fund concentration analyzes the firm's deployed capital across all funds for sector, single-company, and structural concentration patterns. Each flag identifies a specific operational decision the firm is facing in its next investment cycle.
The engine reads four dimensions across every fund the firm runs, using each position's deployed capital, and scores two of them. Sector concentration and single-company exposure are scored because they tend to be emergent, accumulating across funds without anyone deciding them. Stage and geography are shown descriptively, because at the fund level they are usually deliberate strategic choices, and scoring a firm down for executing its own strategy would be reading a decision as an accident.
Cross-Fund Concentration Score
Whether capital is well-distributed across the firm's funds. A 0 to 100 reading, banded from well-distributed at the top to concentrated firm structure at the bottom, alongside a flag list naming each pattern the engine surfaced.
Because the engine groups positions by sector name, and sector names are entered by people, a firm whose records hold climate, cleantech, and climate tech as three separate sectors will read as more distributed than it is. The platform watches for the signature of that problem and surfaces it as a data-quality prompt rather than guessing at what was meant. It does not change the score.
The engine does not say concentration is bad. A firm concentrated by conviction in the sector it knows best is doing the thing that makes it worth backing, and at the Conviction stage that concentration is structurally appropriate. What the engine reads is whether the concentration is consistent with what the firm declared and whether anyone chose it.
It also produces no peer comparison. Unlike Portfolio Efficiency, the Cross-Fund Concentration Score is not shown against a cohort median or a top-quartile threshold, and that is a methodology decision rather than a data-volume one. It will not change as more firms join the platform.