TL;DR - Paul Asel predicts that venture capital will become more consolidated, featuring more large firms and fewer closely-held partnerships as a result of increasing capital intensity.
Helpfulness - 4
Tags - notable investors, future vc
- How is venture capital changing and how are the major players leading the way?
- Venture capital firms are becoming larger and more specialized, rather than smaller shops composed of just a few partners.
- Firms like SoftBank, Andreessen Horowitz, Sequoia Capital, GGV, and Lightspeed are leading the way with both larger and more specialized funds.
- Investment banking and private equity firms offer a potential road map for VC.
- Small partnerships became large, complex firms as the search for more capital led to a need for more corporate structure.
- More capital is becoming necessary for VC as startups increasingly seek to disrupt rather than enable.
- The VC world is also likely to become more consolidated, although this is unlikely to extend to smaller, more specialized seed and early-stage firms.
Follow up links:
- Andreessen Horowitz new fund strategy, https://techcrunch.com/2019/05/01/a16z-ushers-in-new-fund-strategy-with-2-75b/
- SoftBank expansion, https://techcrunch.com/2019/04/30/softbank-vision-fund-says-its-team-will-balloon-to-a-whopping-800-people-by-late-next-year/