The 3X Delusion
Fund Managers have to believe they can produce 3X+ returns or they’re un-investable. But the data shows that they’re statistically wrong and typically produce returns that are inferior on a risk-adjusted basis to the non-VC choices that LPs have.
Same is true with Founders. They have to believe they’re going to succeed but they’re statistically very wrong.
The difference is how long it takes to figure out who’s right and how much money has been deployed before performance is measurable…..and these differences are profound.