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Thursday, August 09, 2007

How well are VC firms doing? Not too well.

Matt Marshall over at Venture Beat analyzes how well VC firms are doing, and the answer: not too well. According to the post, the average VC firm only gives a 2.7 percent annual compounded return over five years which is pretty dismal. Whats more, the median VC firm is losing money, and the average is only pulled up by good numbers at the upper end.

Another analysis by Dan Primack looks at returns post-bubble and finds that the median VC return is -2.6 percent year on year. Dan concludes that the vast majority of VC funds raised since 2001 have underperformed a typical savings account.

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