O'Driscoll: High variance makes venture capital forgiving of overpaying
Rory O'Driscoll · OpenAI's Multi-Billion Deal with AMD & Polymarket, Vercel and Supabase Raise Mega Rounds · 20VC with Harry Stebbings · Oct 9, 2025 · at 32:24
Rory O'Driscoll from Scale Venture Partners compares venture capital returns to private equity pricing risks during a discussion on inflated AI valuations.
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“It is the most forgiving equity business of getting the price wrong. Let me tell you what I mean by that. PE, if you get the price wrong, they're low variance assets. If you overpay by 50%, you're toast, because they're three X assets and they're not going to ever be seven X, right? You're degrees of freedom as well. Same thing in the public markets, right? The great thing about venture, it has maximum variance, which means that it is the most forgiving Of getting the price wrong, because you can get, because you have exponential growth on your side.”
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