# Deal sourcing in venture capital

> Deal sourcing is the work a fund does to find investment opportunities: building networks, asking for referrals, running scouts, attending demo days, researching markets and contacting companies, and making it easy for founders to apply. Deal sourcing creates deal flow; screening and diligence then decide what to do with it. Good funds track which sources produce the companies they actually back.

Source: https://delsivo.com/glossary/deal-sourcing · Updated 2026-11-06

## Key takeaways

- Sourcing is the activity; deal flow is the result.
- Track the source of every deal, so you know which channels work.
- An easy, clear application route is a sourcing channel too.

## Common deal sourcing channels

| Channel | Effort | What to record |
| --- | --- | --- |
| Inbound applications | Low per deal, high in volume | Which page or campaign brought the founder |
| Referrals | Relationship building over time | Who referred, and their relationship to the founder |
| Outbound research | High per deal | The market map or thesis that led there |
| Scouts | Program set-up and upkeep | Which scout, and any conflict |
| Events and programmes | Time at demo days and pitch events | Event name and date |

## An example

A fictional pre-seed fund tags every deal by source. After a year it sees that founder referrals produce a small share of deals but a large share of investments, and that one accelerator's demo day produced none. It spends more time with portfolio founders and less at that event.

## Sourcing and a fund's application route

Founders judge a fund by how it treats applications: a clear form, a receipt and a reply. A [startup application portal](https://delsivo.com/startup-application-portal) with private referral links lets the fund see where each deal came from. Delsivo's [branded portal](https://delsivo.com/white-label-portals) is designed to offer a public link, private referral links and analyst-created records, planned for the Pilot release.

## Common confusions

- Deal sourcing versus [deal flow](https://delsivo.com/glossary/deal-flow): one is the work, the other is what arrives.
- Inbound versus outbound: inbound waits for founders; outbound goes to them.
- Volume is not success. Measure investments and strong passes by source.

## Frequently asked questions

### What is the best deal sourcing channel?

It differs by fund. Track investments by source for a year and you will know which channels work for your thesis.

### Is inbound deal flow worth reviewing?

Yes, for many early-stage funds. It brings founders outside the team's network, as long as the fund can review it consistently.

### What is proprietary deal sourcing?

Finding companies before other investors do, usually through relationships, research or scouts. Few deals stay exclusive for long.

## Related pages

- [Deal flow](https://delsivo.com/glossary/deal-flow)
- [Scout program](https://delsivo.com/glossary/scout-program)
- [Startup application portal](https://delsivo.com/startup-application-portal)
- [White-label portals](https://delsivo.com/white-label-portals)