In truth, I got what you originally meant and was expanding on it.
The fact that VCs can have such a low hit rate and such a low return rate, yet still have a job, is astounding to me.
I think the underlying problem is that there is an incestuous relationship between retirement funds and investors. Nothing else explains why the funds keep giving away 2+20%.
Gotcha. I think if you take the avg fund size divided by # of partners the avg partners gets $30-40mm of a fund. So management fees alone are in the millions for showing up to work. Seems a bit high with no track record. Maybe a better model for LPs would be 1.5-2% for yrs 0-5 (when most investments are usually made) and then 0-0.5%. What do I know...
The fact that VCs can have such a low hit rate and such a low return rate, yet still have a job, is astounding to me.
I think the underlying problem is that there is an incestuous relationship between retirement funds and investors. Nothing else explains why the funds keep giving away 2+20%.