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Fred makes some great points here, but can venture capital truly be "slow capital"? It's my understanding that venture capital funds (the pools of money raised
by BobbyH 17y ago
Fred makes some great points here, but can venture capital truly be "slow capital"?
It's my understanding that venture capital funds (the pools of money raised by VC firms) typically have a fixed lifetime of 7-10 years (http://en.wikipedia.org/wiki/Venture_capital#Structure_of_the_funds http://en.wikipedia.org/wiki/Venture_capital#Structure_of_th...). Also, most VC investments don't occur in the first year the fund was raised, further lowering the years required for liquidity.
This would seem to conflict with the idea that a VC firm can have "no set timetable for getting liquid: slow capital is patient capital".
- stakent 17y agoHe tries to differentiate a his Union Square Ventures from other VC firms.
- fredwilson 17y agoyes i do but Bobby makes a good point. all venture funds have a provision in them that they can be extended and most are. i am still working on deals that were done more than 10 years ago
- pmjordan 17y agoThat's interesting, thanks. Forgive my ignorance, but I'd assume it's up to those who invested into the VC fund whether or not the fund is extended, not the VC partners. What happens when they decide against it and there are still privately owned companies in the fund's portfolio? Is ownership transferred directly to the original investors, who can then choose to liquidate the company or take control in some other way?