Concentrated Or Bust? The Case for Late-Stage Diversification in VC (Part I)

Traditional Late-Stage Portfolio Construction

Angel Investing Sides-Steps Traditional Boundaries

Figure 1. Right-Skewed Distribution of U.S. Venture Returns [3]
Figure 2. What AngelList Data Says About Power-Law Returns In Venture Capital [4]
  1. Mean performance is less than 2x (underperforming public markets given a similar time horizon)
  2. There are only a few funds that return 3x+ (for instance, the odds of capturing a 22x return rests at ~1%)
Figure 3. Power Laws in Venture Portfolio Construction [6]

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Luke Skertich

Luke Skertich

Embracing debate… Gladiator is the best movie of all time.

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