Venture Capitalists Get Paid Well to Lose Money
Harvard Business Review
AUGUST 5, 2014
2013 had all the signs of being a comeback year for venture capital. The industry realized its highest returns since the Internet boom. Yet 2013 annual industry performance data from Cambridge Associates shows that venture capital continues to underperform the S&P 500, NASDAQ and Russell 2000. The ongoing poor performance of venture capital firms should be an obvious problem for institutional investors. LPs pay VCs like asset managers, not investors.