Section 32 founder Bill Maris discusses power-law dynamics and overall fund performance in the venture capital industry.
Assertion Not checkable as stated
Sub-$750M VC funds return 4.76x on average versus 2.42x for megafunds
“Top decile performance of DPI funds smaller than seven hundred and fifty million average return of 4.76 X and funds larger than a billion 2.42 X. Funds below seven hundred and fifty million across that time period represented 95% of top decile performers with …”
Assertion Not checkable as stated
Google forbade using the term 'AI' for years after GV launched
“At that time, Google would not let us use the term AI. And this persisted for many years.”
Assertion Supported
A $7B fund returning 3x exceeds total annual venture exit values
“Now, if you have a seven billion dollar fund, and we do the same math through, you know, you've got to return two hundred and ten billion. Seven billion to 70 times three X is two hundred and ten billion, which, ah, exceeds the total venture-backed M&A and IPO…”
Insight
Bill Maris: Large fund asset accumulation is not true venture capital
“If you're an RIA and you're, you know, collecting assets, that is not venture. You know, venture, as I practice it at least, is a different craft where you are Making concentrated bets of your time and capital on entrepreneurs and helping them build a business…”
Opinion
Tech companies claiming public-benefit missions should IPO earlier to share value
“I also have a, an observation that A bit of an objection to companies that wrap themselves up in public benefit language, and then keep the value creation to themselves and an elite group of investors through a big part of the curve, and then say, well, we're …”
Prediction Not checkable as stated
Maris: Google slashing Gemini prices by 80% would crush AI competitors
“Well, if you're a company, and you can go to Google and Gemini, and you can pay 80% less for that Basically identical product. Why wouldn't you do that? And then the compression and the pressure on those other businesses goes super critical.”