Incentives and Outcomes - Credistick
credistick.com
Incentives and Outcomes - Credistick
This is pretty disruptive from Coatue and I like it very much.
As an LP I’m done paying 2/20 and having 10-12 year illiquidity for shit performance in venture capital. I spoke about this once on the All In pod and shared a table of the various/numerous funds where I’m an LP and their meager DPI as evidence. And those... See more
Chamath Palihapitiyax.com
The central point of the post below is that risk is the product of venture capital, and some managers understand that better than others.
Many of the replies talk about the futility of 'financial engineering', and how concepts like portfolio construction are less relevant to early stage VC due to the greater... See more
There are some important changes underfoot in private markets:
1. Returns are compressing - few funds are able to consistently achieve the necessary spread over the risk-free rate to justify fees and illiquidity.
2. LPs are segregating bi-modally: 1) a growing group of smaller family... See more
Chamath Palihapitiyax.com
In 2009, @a16z raised a brand-defining fund. The plucky EMs — on a mission to steamroll the @benchmark model of VC — are believed to have delivered >5x for LPs from AH Fund I.
Much of their founding story is at-odds with how the firm is perceived today:
Describing their strategy in 2009,... See more
"Venture capital spent the last decade pulling itself in two. The vast amount of capital resulted in the expansion of early investing while also keeping companies private for much longer.
It’s easy to find people talking at cross purposes because they exist at opposite ends of the market. The differences are so... See more