This phenomenon is largely due to the inability or perhaps unwillingness of venture capitalists to identify outlier businesses. The recent generation of startup investors turned the industry into a rent-extraction scheme by chasing growth and paper markups over identifying valuable businesses. And research now shows that most of the popular heuristics VCs' use to select startups are negatively correlated with returns.
One solution is simply to disendow large VC funds, and change the processes limited partners use to select investors.
One solution is simply to disendow large VC funds, and change the processes limited partners use to select investors.
https://www.wired.com/story/to-save-the-innovation-economy-b...
https://www.theinformation.com/articles/venture-capital-isnt...