Think 2025 will be smooth sailing for VCs? Then it’s time to think again. Over breakfast at Caravan in Fitzrovia, the finance teams from 30 venture capital firms got a crash course in what the year ahead might look like – and it wasn’t sugar-coated. 

With around $10 billion in assets under management represented in the room, the Bound x HFL VC Breakfast brought together finance leaders to confront the reality of the VC landscape. Topics ranged from tough fundraising conditions to the pros and cons of automation and outsourcing.

Led by moderator Eleanor Hill, the expert panel consisted of: Ian Milbourn, CFO and COO, Notion Capital; Abbie Hewlett, Executive Director, HFL; and Marita Cavalcanti, CFO, Bound. And they didn’t hold back! 

Fundraising in 2025: harder, faster, and less forgiving 

If you thought 2024 was tough, brace yourself. “LPs aren’t handing out money for promises anymore,” Ian told the room. “They’re asking, ‘What’s your track record? Where’s the liquidity? Show me the DPI [distributions to paid-in capital].’ And if you don’t have it, you’re out.”

Ian revealed that Notion Capital is rethinking its strategy to meet these demands. “We’ve always held onto deals until full exit, but now we’re exploring mid-deal sales. LPs want to see distributions earlier, and we need to adapt to that.”

This sentiment around a tough environment was echoed by the room. In a quick poll, 44% of attendees said they expected 2025 to broadly mirror 2024 – steady but challenging – while another 44% expected it to be much like 2022, a year defined by cautious investment. Not a single attendee voted for the bumper year that was 2021, when $700 billion poured into tech.

For Marita, this challenging backdrop means that portfolio companies must always be ready. “You can’t afford to wait for the perfect moment to raise,” she explained. “Your data room needs to be immaculate, your story needs to hold water, and you need to exude confidence. Anything less and investors will move on.”

Abbie added that LPs, even smaller ones, are asking deeper questions. “We’re seeing DDQs [due diligence questionnaires] that go into incredible detail now – things we only really saw from institutional LPs a few years ago. The bar is higher for everyone now, and it’s not coming back down.”

All-in-all, the message for VC finance teams is that preparation is no longer a luxury. Building trust with LPs means anticipating their demands, demonstrating resilience, and showing that you’re always ready to deliver.

Where automation goes wrong

The panel then moved on to tackle arguably the hottest topic in finance right now: AI and automation. Interestingly, while the latter has been sold as a cure-all for operational inefficiency, the room revealed a more nuanced reality. When polled, 56% of attendees said their finance teams were “somewhat automated,” while the remainder admitted they were still doing most things manually.

But most attendees were looking for better tech to streamline their workflows and free up time for higher-value work. Marita shared some sage advice for those looking to automate: “At Bound, we use our own platform to cut FX hedging down to something we can handle in two minutes a month. That’s a game-changer, but only because we started with a clear problem to solve. You need to know where your pain points are and address those first.”

Ian shared a different perspective, reflecting on Notion Capital’s journey of implementing three systems in 18 months, including a CRM, a fund accounting platform, and a portfolio management system. “We thought automation would be the answer to everything, but it’s not that simple,” he admitted. 

“We learned the hard way that if you automate chaos, all you get is faster chaos! The real work is in stepping back, rethinking your processes, and then automating something that actually makes sense. These systems only work now because we put in the time to figure out what we really needed from them.”

For Abbie, the issue often lies in overcomplicating things. “Too many companies rush into buying tools without understanding the ROI,” she said. “I’ve seen finance teams drowning in tech that doesn’t solve their problems. Automation should simplify and empower your team, not bury them under new layers of complexity.”

The panel also discussed the importance of integrating automation with a wider strategic vision. “It’s not enough to just automate one or two processes,” Ian added. “You need to think about how those processes connect and how they’ll work together across your organisation. Otherwise, you’re just creating more silos.”

Marita summed it up with a reminder that the goal of automation is to give teams space to think, not to overwhelm them. “The value comes from freeing up people’s time for what really matters – like strategic decision-making. Machines are great at the grunt work, but it’s humans who drive the business forward.”

Outsourcing: smarter, not lazier

Sticking with the theme of working more efficiently, outsourcing emerged as a major theme for the panel, particularly in areas where specialist expertise can make a tangible difference. As a fund administrator, HFL has extensive experience in this space, and Abbie was quick to challenge outdated perceptions.

“Outsourcing isn’t about handing over responsibility or losing control,” she said. “It’s about focusing your energy where it matters most. Fund administrators don’t just keep the books, we take care of compliance, reporting, onboarding, and all the operational complexities that bog finance teams down. That frees you up to focus on strategy and growth.”

For Ian, the decision to outsource fund administration at Notion Capital came after much debate. “We spent a lot of time asking ourselves, ‘Do we really want to be dealing with drawdown notes and waterfalls? Do we want that in-house?’” he explained. “The answer was no. The reality is, outsourcing lets us focus on the big picture – on raising the next fund, supporting our portfolio companies, and working on what actually drives value for our LPs.”

Meanwhile, Marita shared the portfolio company perspective, arguing that outsourcing can be transformative when paired with the right systems. “If something isn’t adding value, it’s a candidate for outsourcing. But don’t think of it as a dumping ground for your operational mess. You need strong processes and clarity about what you’re trying to achieve. That’s when outsourcing really works.”

The panel also addressed the stigma some firms associate with outsourcing. “There’s this idea that outsourcing means losing control, but it’s the opposite,” Abbie said. “Good fund administrators give you more control by adding structure, visibility, and expertise. It’s about enhancing your operations, not replacing them.”

Ian also highlighted that outsourcing can also act as a buffer between VCs and LPs. “Having a third party handle sensitive areas like reporting and compliance can actually improve relationships with LPs,” he explained. “It brings objectivity and ensures consistency, which is something LPs really value.”

For VCs hesitant to embrace outsourcing, the panellists advised starting small. “Pick one area that’s causing your team the most friction,” Marita suggested. “Then test the waters with a trusted partner, and see how it frees up your capacity. You’ll often find it has a bigger impact than you expect.”

The key takeaway here was that outsourcing isn’t about cutting corners or losing control. Done right, it’s about creating space for better decisions, faster growth, and stronger partnerships.

Collaboration and agility: the secret weapons

Linked to outsourcing, a recurring theme of the event was the power of collaboration. From working more closely with fund administrators to aligning with portfolio companies, the VCs who thrive over the year ahead will be those who consistently work to break down silos.

The panel also stressed that 2025 isn’t waiting for anyone. VC finance teams must be ready, be agile, and embrace the uncomfortable. From tougher LP scrutiny to the rising role of AI, VCs must act early, adapt quickly, and work smarter. As the panel concluded – in times of uncertainty, flexibility always wins.