The "power law" / all-or-nothing form of VC is really just one flavor of tech investing. It is certainly the most widely discussed, and maybe its the best, i d

The "power law" / all-or-nothing form of VC is really just one flavor of tech investing. It is certainly the most widely discussed, and maybe its the best, i dont know, but there are other successful models. For ex, many growth equity funds focus on a "doubles and triples" strategy where the risk / return profile is somewhere in between that of a bank loan and VC. They're looking for high probability of 5-7x returns, and low probability of capital loss, for each deal. Theoretically, this "bootstrappers' VC" model can be thought of as a scaled-down growth equity model: revenue-generating businesses in growing markets with potential for near-term profitability Biotech VC is another good example of a "singles and doubles" strategy generating outperformance. Until the last few years, it was rare for a biotech startup to get to a $1B+ valuation in a 5-7 year venture timeframe, and considered impossible for a biotech startup to become a decacorn in that time period. A successful exit was a ~$500M outcome that returned a 5-10x. These funds have outperformed tech in many cases. See 37:46 here [0] To build a fund that can return 3x in an environment with constrained exit sizes, you need to focus on consistent doubles and triples: 1) low loss rates, 2) capital efficiency, 3) modest valuations, 4) disciplined investment decisions. I don't know whether the fund math works for this particular "bootstrappers VC" model, but it is certainly possible for a disciplined "doubles and triples" venture fund to perform well [0] https://lifescivc.com/2019/02/our-year-in-review-annual-talk-on-macro-biotech-and-atlas/ https://lifescivc.com/2019/02/our-year-in-review-annual-talk...