U.S. Startups Fail to Attract Expected Crowd of Small Investors

Re:U.S. Startups Fail to Attract Expected Crowd of Small Inv... by kbenson on Friday May 19, 2017 @01:46PM (#14377881)

> And, again: most VCs fail! A lot of money is invested in VCs not in the expectation of those investments being lucrative, but instead in the hopes that VC returns are uncorrelated with the public markets.

Are there meta-VC's that treat VC funds like startups and invest in multiple VC funds with the understanding that most will fail? That is, can you confirm my suspicion that it really is turtles all the way down (or up)?

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Re:U.S. Startups Fail to Attract Expected Crowd of Small Inv... by hkmurakami on Friday May 19, 2017 @02:02PM (#14378006)

Fund of funds exist. They typically become LPs in PE funds and Hedge funds. Their value add is that they provide fund selection for sovereign funds / pensions / endowments that feel that they do not have the expertise to become LPs directly in the right funds (I find this value add to be bs, but I guess I'm unfamiliar with how clueless someone directing a random sovereign fund could be).

Larger VCs will become LP in smaller upstart ones to have better visibility into earlier stage companies [1].

[1] Bessemer, Emergence, Social, and Sapphire are LPs in Saastr Fund http://www.saastrfund.com/strategic-partners-1/

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Re:U.S. Startups Fail to Attract Expected Crowd of Small Inv... by edanm on Friday May 19, 2017 @01:54PM (#14377945)

Most VCs raise money from things like pension funds, which manage a lot of money, and I believe invest in multiple vcs.

They Usually invest a very small amount of their money in this sector, usually a fee percent at most.

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