Bid farewell to the Venture investment “J-curve,” the notion that a venture fund has to suffer through negative returns in the early years before progressively yielding positive returns and generating liquidity in the outlying years. These days, VC funds and their investors have to deal with an even more challenging reality: a “W-curve.”

Venture-backed companies currently average more than eight years from initial VC funding to liquidity event, and many take longer. As short-term economic cycles typically span five to seven years, companies can expect to go through at least one economic downturn before a liquidity event, frequently leading to a W-shaped venture investment curve. (…)


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