A few weeks back I took a call from a group looking to start a new seed fund. After exchanging backgrounds and niceties I asked why they wanted to start the fund. Their response? To make money.
My response? They’d make more money putting their cash into a money market account. That’s not very sexy or exciting but it’s reality. Today’s data from Cambridge Associates backs that up. From the report:
The median net return to VC fund investors has not been positive for any vintage year since 1998. Just think about that for a moment. Despite the past decade’s many hits (Google, YouTube, EqualLogic, etc.), the typical VC fund has lost money for its limited partners. Even the top-quartile benchmarks aren’t very impressive over the past decade, with the best figure coming in at 5.59% for 2001 vintage funds.
To read the full, original article click on this link: Investing In Startups Is A Terrible Way To Make Money
Author: Bryce Roberts
