What this actually means is that VCs have no idea if a company will be successful or not and it's basically luck. The ones that survive are the ones who manage to hit one of their gambles with outsized wins, similar to a roulette table.
Why some continue to believe VCs actually know anything or add value is beyond me. Even YC admits as much, saying their best guess is the caliber of the founder, and that there should be at least 2 co-founders. Everything else is a guess.
Wrong. If you have enough money, and your gains are sufficiently outsized from a win, then any spread bet across dozens of companies will end up making money. Being a VC in Silicon Valley over the last 20 years is a game you can't lose, as long as you have enough money. And let's not forget, they're not even playing with their own money, they are playing with their investors money.
But it doesn't mean you're a smart VC it just means that you're a rich VC. They have enough high profile misses to show they have no idea what is going to be successful. They passed on Google, Apple and Facebook with a combined market value of almost $1.5 trillion dollars.
> Being a VC in Silicon Valley over the last 20 years is a game you can't lose, as long as you have enough money
You won’t find a source for this because it isn’t true. Lots of VCs have busted because despite diversification, the odds of a single company in a portfolio of 20 to 100 making it big are very small.
Why some continue to believe VCs actually know anything or add value is beyond me. Even YC admits as much, saying their best guess is the caliber of the founder, and that there should be at least 2 co-founders. Everything else is a guess.