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If you knew which startups would win, why invest in losers?

The Full Ratchet · Investor Stories 460: The Math Behind Venture Returns, When...

“And, you know, presumably, everyone should recognize this because there are, as everyone knows, very few big winners in any portfolio.”

1:40 / 2:13

that I've run into because there's a certain win rate you're gonna have on any individual investment. And I I do believe it's just hard to know in advance. You do your best, but it's hard to know what are gonna be the winners and what are gonna be the losers. And, you know, presumably, everyone should recognize this because there are, as everyone knows, very few big winners in any portfolio. And of course, if you knew which ones were gonna be those in advance, why did you do all the other ones?

About this clip

A venture capitalist explains the fundamental unpredictability of startup success, arguing that even experienced investors can't reliably predict which companies will become the rare big winners in their portfolio. The insight challenges the notion that VCs have special foresight about individual investment outcomes.

Why this clip

This moment crystallizes a core truth about venture investing that contradicts common assumptions about investor skill and foresight.

1:40 - 2:1333sframework
investment-selectionportfolio-strategyventure-returns

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