You would never hear this from a Sand Hill Road Venture Capitalist (VC), but the details are in and professional venture capital is mostly the exception, not the norm, as a funding source for startups.
In fact, it’s less than 1 percent. At NBT Equities Research we more often than not look for opportunity in the 99% of emerging growth companies initially funded by angel investors, founders and public venture capital via Alternative Public Offerings (APOs).
Why? Because again…if you look at actual results… more VC-backed new companies fail than succeed, and since 1999 the VC funds that have backed the lucky “1%” have barely broken even. Their investors would have earned 3X more return on their “venture” money by putting their VC fund investment into money market funds.