For the last decade, the “endless aisle” was the mantra of every omnichannel retailer — infinite options, ultimate convenience, and unlimited scroll. But choice is no longer empowering. It’s paralyzing.
When I started in VC, there was one incentive — capitalize startups, help founders build their businesses, and bring in additional capital (when necessary). Hopefully, if the stars aligned, the funds delivered outsized financial returns for the risk, ideally 3X or more, to their LPs. This model was a relatively well-tested formula for venture-backed startups — provide enough capital to the company (but not too much) and maximize its chances for a healthy return, hopefully in less than ten years.
Do companies that load up on venture capital actually outperform those that more efficiently deploy capital? We looked at 71 tech IPOs from the last five years to find out.