Soul destroying
“Soul destroying”– a cartoon that illustrates how the rise of mega VC funds is undermining their traditional value.
Sequoia Capital this week became the latest venture firm to become an investment advisor, which they believe will help them compete more effectively with hedge funds like Tiger Global or Coatue.
In parallel, venture firms are raising much larger rounds, with almost half of all funds raised in 2021 are at least $100M in size, up from about 30% in 2014.
In practice, this means venture partners have to spend more time deploying larger amounts of capital, often at the expense of making a meaningful difference to their portfolio companies.
For example, less time for board seat roles or nurturing first-time CEOs … effectively losing the unique value of the operating experience that venture capital partners have historically provided to early-stage investing.
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