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Unicorns are rarer than 1/10 and 30% of investments generally pay off, according to research, with some positive results.

• rm_-rf_slash 11y ago
  Ok so my numbers aren't exact but you are right, the aggregate return of VC investments tend to be positive. Same with the stock market. However, VCs are in more of a position to influence the growth of their investments. There is nonstop hype for companies that make zero profit because of the hope that it will enable bigger funding rounds, a buyout, or an IPO. The only difference between overhyped no-profit startups and a Ponzi scheme is that the latter knows the investment is a bust, while the former isn't sure.
  • twblalock 11y ago
    Actually, there are quite a few other differences, including the fact that Ponzi schemes are intentionally fraudulent, and the fact that the many of the "overhyped" startups actually do have a chance at succeeding, which is proved by the fact that some do succeed.
• chris_va 11y ago
  Anecdotally, I would say 30% positive, 30% total loss, and 30-40% somewhere in between. Fund returns will definitely be biased towards the top 1-10%, like in any lottery system.
• bduerst 11y ago
  Which usually isn't good enough for high-risk investors in VC firms. Marginal returns on 30% of investments is likely worse than marginal returns on an index fund.