Based on research we are doing with LBS, we take a look at current industry trends to understand why VC funds are facing a differentiation challenge, and whether the traditional model of cash + advice is enough to attract discerning founders. The VC business model is inherently constrained, whereby the “two and twenty” rule prevents them from offering additional support to founders. By breaking that model, it’s possible to unlock a game-changing combination of capital + operational support to help build awesome tech startups.
*I’m particularly keen on the last one, as this is new territory for us, and we’re making some controversial statements about VC’s value add, to explore alternatives at a time when there’s a lot of competition (crowdfunding, superangels, ICOs etc.) and incumbents are finding it increasingly difficult to differentiate themselves. Happy to make the title a bit snappier.