Just met one of the researchers at Defiance Capital, which did an analysis of unicorn founders’ backgrounds, published today in TechCrunch, .
Some interesting takeaways:
“There’s only 30 funds that have more than 1% share of all these unicorns, which means that it’s totally fragmented,”
“If you combine this fragmentation with the fact that immigrants and women found it harder to fundraise, there’s a huge opportunity for new funds to come in and specifically set out to look for these founders.”
’I asked him how a VC or a family office might change their strategy as a result of seeing this research?
“Sequoia being the top fund in only 2.8% of unicorns means that they miss a lot. Yes, for LPs, top funds are a relatively safe investment. But family offices are now looking at emerging managers and especially early-stage funds as the potential Alpha. So if you’re looking to maximize returns as a family office, you need to be in a few new funds, emerging managers in order to get that outlier company that turns into a unicorn,” he said.
Some interesting takeaways:
“There’s only 30 funds that have more than 1% share of all these unicorns, which means that it’s totally fragmented,”
“If you combine this fragmentation with the fact that immigrants and women found it harder to fundraise, there’s a huge opportunity for new funds to come in and specifically set out to look for these founders.”
’I asked him how a VC or a family office might change their strategy as a result of seeing this research?
“Sequoia being the top fund in only 2.8% of unicorns means that they miss a lot. Yes, for LPs, top funds are a relatively safe investment. But family offices are now looking at emerging managers and especially early-stage funds as the potential Alpha. So if you’re looking to maximize returns as a family office, you need to be in a few new funds, emerging managers in order to get that outlier company that turns into a unicorn,” he said.
