Lessin: Indexing the seed market is economically irrational for multi-billion-dollar funds
Sam Lessin · Sam Lessin on Meta, Artificial Intelligence, and Investing in Creators. · Mar 12, 2025 · at 9:06
Sam Lessin analyzes the fund math explaining why multi-billion-dollar venture funds like the Vision Fund cannot effectively index early-stage seed startups.
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“Historically speaking, when big funds try to index the seed market, there are two problems. One is someone wakes up and does the math and they're like, this doesn't make any sense, right? Like even if you have the million dollar check at seed, if you're trying to deploy billions of dollars, like it's just an irrational business model because the multiples don't make up for the fact you have to move gross dollars, right? So the best case you're doing at seed then is just marketing.”
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