Venture capitalists fund the innovation economy. With $130.9 billion invested in venture capital funds in 2018 — more than the previous heights set during the dotcom era — you might think that we will see lots of exciting new companies with innovative products and services creating lots of well-paying jobs. The truth is that the investors who invest in innovation — the limited partners (e.g., pension funds, foundations, endowments and family offices) — are trying to de-risk their investments by investing in later-stage venture capital funds. These companies have figured out their product-market fit and go-to-market strategies. While later-stage companies are more stable and less likely to go bust, they are also less likely to deliver a high return on investment.
