>The top funds can return a rate of over 20% while the median is close to 10% and the bottom venture capital firms may produce a negative return. If startups we

>The top funds can return a rate of over 20% while the median is close to 10% and the bottom venture capital firms may produce a negative return. If startups were all just lottery tickets then there wouldn’t be such a consistently different rate of return among venture capital firms. That makes no sense. For an easy kind of counter example, suppose I have two kinds of $1 lotto tickets, A and B. Both are incredibly unlikely to pay out. Ticket type A returns about $12k one in 10k tickets, resulting in a 20% rate of return. Ticket type B returns $8k one in 10k tickets, for a negative 20% rate of return. Being able to distinguish between them doesn't make them any less of lottery tickets. Being able to distinguish between these is great if you're an investor buying tons of tickets, but if you only buy a handful in your lifetime you probably won't win, so maybe it's good advice to treat these lotto tickets as what they are and focus on other things that matter like happiness and salary.