The LP Education Gap
LPs trained on 2/20 reject studio economics. Bake education into the fundraise, or prove the model first with service revenue, then raise on a track record.
Most LPs were trained on the 2/20 venture model. Studios don't fit that model — they need 10-15% of capital for operations, not 2-2.5%. First-time studio managers without track records get rejected for sounding "too operational" or "too expensive."
The fix is to bake LP education into the fundraise itself. Lead with the unit economics of a single venture cycle, show why operating capital is the difference between a studio and a fund, and only then talk about the portfolio thesis. Skipping the education step is why so many first-time studios stall.
The alternative path is to start with service revenue or strategic-corporate funding, prove the model on two or three ventures, then raise LP capital with a track record. The order matters more than the structure.