Despite the delusions of positivity in the media that stem from looking at Venture Capital numbers from a short-term perspective, long-term performance mitigated by fund diversification, syndication, fragmentation, and collusion, Venture Capital performance 10-year returns managed to fall from a miserable -4.2% to a downright horrid -4.64% over the relevant period. Even worse is the vintage-year data provided by Cambridge Associates, which tracks VC fund performance based on how the fund was raised.
Who are these Idiot Limited Partners and Idiot Entrepreneurs who keep going back to the same VCs and listen to their compass, like victims suffering from the Stockholm syndrome? With our government in desperation greasing the skids to an economic model that does not work? Venture’s grand opportunity is to fix its economic model and reinvent Venture from the top to provide new access to an 80% greenfield of technology innovation that still lies ahead.
My new year’s prediction has again come true, in little over one month this time. Sadly.