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You wouldn't reinvest all your returns. You'd distribute most of them to your limited partners (the people who supplied the money).
by pg 16y ago
You wouldn't reinvest all your returns. You'd distribute most of them to your limited partners (the people who supplied the money).
- csallen 16y agoRight. I guess what I wanted to point out is that you may be overestimating the super angels' strategy and the returns VCs would have to get to compete ("10^6—one million x"). If the super angels can't reinvest all their returns, they won't actually make anywhere near that much. Even if they could reinvest it all, their returns would diminish each year. So the question is, how much will they make with their current strategy? I don't know enough about the relevant numbers to do anything more than speculate. But if I had to, I'd bet the super angels are better off focusing on finding big winners than they are worrying about valuations and quick returns.