Strategies
Venture Capital
A private equity strategy of taking minority equity positions in early- and growth-stage companies, with returns driven by a small number of outsized winners.
Venture returns are governed by power-law dynamics: a single 50x outcome can drive a fund's overall return. Selection, access to the best deals, and follow-on reserves are the dominant drivers of GP performance.
For LPs, the diligence emphasis differs from buyout: deal flow quality, brand strength, partner-level attribution, and concentration risk in winners. Vintage diversification is especially important given the cyclicality of exit markets.