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I’m in Singapore this week for meetings and took the opportunity to attend GITEX Asia—one of the largest tech events in the region.
The highlight for me was a fireside chat with Kee Lock Chua, CEO of Vertex Holdings, the Temasek-owned VC platform managing $6 billion and deploying capital across the U.S., Israel, China, Japan, India, and Southeast Asia. His global vantage point is rare in VC. Here are the five takeaways that stood out.
1. The Post-FOMO VC Cycle
VC is back in a rational phase. The 2021 wave of over-exuberance has crashed, and what follows is a slower, more deliberate approach to capital deployment. Early-stage rounds that used to close in weeks now take 6–9 months, but they do happen. Late-stage is harder, especially for companies still carrying inflated 2021 valuations. As Kee Lock Chua put it: “They are perpetually raising a pre-IPO round.”
2. AI Domination?
AI now accounts for over 50% of global VC funding, but a lot of that is noise. The hype has attracted opportunistic players, echoing the dot-com days. Building foundational models is costly ($1M+ salaries for AI scientists), so most activity has shifted to application layers and efficiency-focused AI. Smart investors are getting sharper about where the real value lies, and are increasingly selective.
3. The Tariffs’ Impact
Recent tariffs and geopolitical friction complicate cross-border tech bets, but software stands out. It’s largely unaffected by trade restrictions (for now), and easier to scale globally. Kee Lock Chua pointed to strong momentum in sectors like cybersecurity (Israel), deep tech software (Japan), and SaaS solutions to real-world issues (like wildfire detection) that are less exposed to geopolitical crossfire.
4. Forcing Local Innovation
Tariffs and trade walls slowing global collaboration may spawn a new wave of domestic innovation. In India, for instance, startups build domestic alternatives to formerly imported tech (chipsets, software, infrastructure). As Kee Lock Chua noted, “We can’t build a chipset that sits between China and the U.S. anymore.” That constraint is now a driver of creativity.
5. Fewer Me-Toos, More Room to Build
Slower VC markets give Founders breathing room to innovate. With less FOMO-driven capital chasing copycat ideas, high-quality startups face less noise and competition. The best are capital efficient, resilient, and focused on profitability from day one. It’s harder to raise money, but relatively easier to stand out.
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The conference was a great opportunity to get the pulse of Venture Capital across so many markets—especially as I continue mentoring emerging VCs active in these regions through the Emerging VC Accelerator.
Related content:
– Apply now for the Emerging VC Accelerator
– Why Series A Graduation Is So Hard: Lessons from Paul Graham
– Venture Capital Funds: 5 Questions For Optimal Capital Deployment
I first heard about Jean de La Rochebrochard—the head of “the most active business angel in the world,” Kima Ventures—over a decade ago, when he was a startup fundraiser, and I had his boss pitch for one of my portfolio companies. We’ve been in close circles, but I’d never met Jean or heard him speak. At a recent conference, I finally did, and I was pleasantly surprised by how candidly he talked about himself and his decision-making process. Much of what Jean said aligned with my research on elite VCs’ mindset, which I’m now infusing into first-time fund managers through the Emerging VC Accelerator. Here are five points that stuck with me. “Risk is just an information.” Contrary to common belief, the best-performing Venture Capitalists aren’t the most cautious. Statistics show that 3x funds have a higher loss rate than 2x ones. The highest-performing GPs expose themselves to more downside and more variance, because that’s where outliers live. But they don’t make risky bets for the thrill. They just see risk as part of the input—not something to avoid or to get emotional about. Jean said this about his own career: leaving a stable, well-paid job at 30 to join a startup accelerator that barely existed at the time. “I was right and nobody listened to me.” One of the defining traits of elite VCs, those who make outlier bets repeatedly, is that they make decisions from first principles and don’t wait for consensus. They don’t need external validation, they’re not the herd animal now overpopulating the asset class. They don’t care about what others think. When asked why he had decided to become a VC, Jean opened up about his Capitaine Train experience. He firmly believed the startup was special, but every Investor he approached passed. Capitaine Train exited in 2016 for hundreds of millions of euros. “If I can be helpful to a couple of Founders every week, I’m f-ing happy.”* Some Investors love winning. Others love being right, or being in the news. Like Founders, VCs must have a strong driver to perform at a high level amid frustration and uncertainty. The first question I ask applicants to the Emerging VC Accelerator is: “Why do you want to become a VC?” Their answer informs me about their future commitment level. Jean talked about being useful. He mentioned hitting his ikigai in his job as a VC—mixing passion, vocation, and a mission of helping Founders succeed. It’s a tough one when you make two investments a week and have over 1,000 portfolio companies. “Never doubt, often wrong.” Another trait I discovered in many top VCs is that, while they do hold beliefs about the world, they’re not committed to an idea in the face of factual information to the contrary. They have strong convictions that are loosely held, a phrase often mentioned by Silicon Valley entrepreneurs and VCs. Jean echoed this sentiment, saying he was assertive but changed his mind all the time when presented with contrary evidence. “I haven’t seen any patterns in successful entrepreneurs.” This one both surprised me and pleased me. You’d expect someone who has invested in hundreds of entrepreneurs, with his fair share of success, to have developed an algorithm in his head about what the successful Founders do differently. Everyone in VC wants to spot patterns. It feels safe. But pattern-matching leads to average returns. Outliers, almost by definition, don’t look like the last success. Bill Gurley once said that you must break your mental models to make home-run investments. Every quote above echoes detailed analyses I wrote about on my website. I’ll leave you with three, but I hope you’ll go around and poke into the minds of successful VCs. Related content: – A Manifesto For Mindset-Based Investing – Understanding the Power Law: Do Venture Capitalists Take Enough Risks? – How ChatGPT Can Help Venture Capitalists Make Better Investment Decisions |
After speaking with over 20 first-time VC fund managers from around the globe since launching my Emerging VC Accelerator three weeks ago, one critical insight became crystal clear: many new managers fall into the trap of asking LPs for too much, too soon.
It’s an understandable mistake, but it can stall their fundraising efforts before they even start. Just as early-stage Founders struggle when trying to raise significant capital without meaningful traction, first-time VC fund managers often approach LPs prematurely without tangible proof they can effectively source, evaluate, and close deals.
The reality is that LPs face substantial risk when backing untested investors. Successful emerging VC managers recognize this and develop a robust pipeline of potential investments long before they actively approach LPs.
By clearly articulating specific investment opportunities, demonstrating an existing pipeline of high-quality startups, and highlighting tangible signs of diligence and deal momentum, emerging VCs can convert skeptical LPs into early believers.
Reflecting on my own experience participating in three fundraisings for funds, the most compelling factor for LPs was consistently our tangible, anonymized pipeline of startups with impressive metrics, combined with two or three term sheets ready for execution.
This approach accomplished two objectives:
- 1/ It illustrated our investment strategy to LPs, clearly showing the type of startups we targeted, and
- 2/ It validated our thesis by demonstrating real market readiness. Confronting our thesis with Founders ensured that the universe we envisioned was large enough to deploy the amount of capital we aimed to raise.
This kind of practical advice is exactly what I aim to unlock for the emerging VC managers I mentor through the Emerging VC Accelerator.
Fundamentally, overcoming this early-stage hurdle is a mindset shift, not a technical challenge.
Related content:
– How VCs Help Founders Optimize Seed & Series A Funding Rounds
– How The Best LPs Evaluate Emerging VC Fund Managers
– A Manifesto For Mindset-Based Investing
Every few months, someone on VC Twitter or LinkedIn revives the old debate: Is the power law a bug or a feature of Venture Capital?
The real problem isn’t the power law at the startup level. That part’s widely accepted. A few deals drive the bulk of the returns—Horsley Bridge famously showed that 6% of deals generated 60% of the asset class’s gains.
What’s less discussed is how this dynamic extends upstream.
I call it the “Super Power Law“: a tiny subset of Venture Capital funds—and even fewer GPs behind them—generate the vast majority of returns for Limited Partners.
It’s a measurable pattern, and I found the data to support this claim.
One 30-year analysis of 1,300 VC funds showed that the top quartile of VC funds produced an average 30% IRR, while the bottom quartile had negative returns.
Recent data shows that even they are dwarfed by the top 5%, who produced more than double the upper quartile funds’ returns.
That’s why experienced LPs such as David Clark highly concentrate their portfolio with these elite VC firms repeatedly producing alpha (read the first article linked below for a case study on Founders Fund).
VenCap generated over 3x MOIC, a best-in-class performance among VC funds of funds.
But how about LPs backing emerging managers?
Traditional filters like track record fall short. To identify future outliers in first-time fund managers, you need to go deeper.
I argue—and I now practice via the Emerging VC Accelerator—that mindset is the best predictor of future performance.
You don’t need to bet on everyone. You need to find the few who will matter.
Related content:
– Data backing the Super Power Law in Venture Capital
– How The Best LPs Evaluate Emerging VC Fund Managers
– A Manifesto For Mindset-Based Investing
Last week, I attended the Florida VC Conference, a gathering of 150+ investors active in Miami’s booming startup hub. The mood was cautiously optimistic.
On one hand, money is still flowing into top deals. There’s plenty of dry powder, and while liquidity is tight, the best startups are still getting funded with 2020esque Founder-friendly terms.
On the other hand, LPs still feel overallocated to Venture Capital. While many are slowing commitments, experienced institutional LPs remain “programmatic”—they invest through both downturns and booms.
For VC firms raising funds, the old playbook doesn’t work anymore. GPs can’t just pitch another 10-year fund with long liquidity cycles. LPs want faster exits, quicker returns, and a clear stance on how AI is reshaping VC itself.
I met with several GPs planning to raise funds towards the end of 2025. Many are actively speaking with long-lasting LPs to gauge their appetite.
This shift toward capital efficiency is even more critical for emerging VC managers. Raising a $25M fund is possible, but scaling beyond that requires a compelling edge.
Seems like a perfect time to launch my new Emerging VC Accelerator, a program to mentor and fund VCs launching their first fund.
The conference’s best quote award goes to Boldstart’s Ed Sim, a multiple Forbes Midas List laureate:
“Board VCs are like margaritas. One is not enough, three is too much. Two is about right.”
Related content:
– Emerging VCs: How The Best LPs Evaluate Emerging VC Fund Managers
– VC Liquidity: VC Funds DPI: How Long Until Venture Capital Delivers Outlier Returns?
– VC Secondaries: VC Secondaries: Is The Market Ready?
One of the most frustrating aspects of being an Investor is watching Founders make the same mistakes—especially when it’s with your money.
There are two ways to handle it. Accept that, like children, they need to learn the hard way. Or understand why it happens and either help them avoid them or back Founders who are less likely to fall into the common traps.
Take one of the most persistent myths in startups: raising money to reach product-market fit instead of engaging in a virtuous test-and-learn loop with customers.
I’ve thought a lot about why this keeps happening and landed on three key causes:
Fear of failure keeps some entrepreneurs in an endless cycle of refining instead of launching and confronting real feedback.
Overconfidence makes others rush ahead before they’ve validated their assumptions.
How Founders learn—the way they process information, integrate feedback and refine their approach determines whether they correct course or double down on bad decisions.
This week, I dive into entrepreneurial learning—why it’s one of the most overlooked predictors of success and why Investors should be evaluating it as part of their due diligence.
Go Further:
– The Most Underrated Due Diligence Item in a VC’s Checklist: How Founders Learn
– Fear of failure: Why Series A Graduation Is So Hard: Lessons from Paul Graham
– Overconfidence: Are Entrepreneurs Delusional? The Overconfidence Factor in Startup Success
One of the most consistent personality traits I’ve observed in entrepreneurs over the years is a tendency to live in denial.
They don’t seem to perceive the inherent risks of their ventures like the rest of us. My research and experience show that, more than delusion, the trait dominating Founders is overconfidence. It is both a cornerstone of the entrepreneurial mindset and a double-edged sword.
Research reveals that overconfidence often helps entrepreneurs move forward despite uncertainty. It enables bold decisions, such as entering competitive markets or pursuing untested ideas. However, it can also lead to costly misjudgments, such as underestimating market challenges or ignoring critical feedback.
Case studies like Airbnb illustrate how overconfidence can be a powerful force. Co-Founder Brian Chesky’s unwavering belief in his team’s ability to overcome trust issues—despite skepticism from elite Venture Capitalists like Fred Wilson—enabled the creation of a system that transformed strangers into hosts and guests.
However, for one Airbnb, how many failures are there due to overconfidence?
Understanding its dual nature helps refine startup evaluation processes and investment selection.
Go Further:
– Are Entrepreneurs Delusional? The Overconfidence Factor in Startup Success
– How The Legendary VC Arthur Rock Evaluated Startup Founders
– How ChatGPT Can Help Venture Capitalists Make Better Investment Decisions
This week, I revisited the legacy of Arthur Rock, one of the founding figures of Venture Capital. His contributions shaped both the industry and the trajectory of some of the world’s most influential companies.
Rock’s career is a masterclass in recognizing potential where others see risk. His early bets on Fairchild Semiconductor and Intel laid the groundwork for Silicon Valley as we know it today. Beyond providing capital, he pioneered a relationship-driven approach.
Here’s what stands out about Rock’s approach to VC investing:Spotting Talent Over Ideas: Rock famously invested in Founders, not ideas. His confidence in Robert Noyce and Gordon Moore at Intel exemplified his belief that the right people drive success.
Championing Vision: Rock often went against the grain, backing unproven technologies and business models when others hesitated.
Active Involvement: Rock worked closely with his portfolio companies, offering guidance on strategy, management, and growth. For example, he remained a Board member of Intel for over thirty years.
Arthur Rock shaped Silicon Valley’s DNA by championing bold entrepreneurs who had “fire in their belly” and were intellectually honest enough to see things as they were.
In this week’s blog post, I explore Rock’s legacy and the timeless lessons he offers for today’s Investors regarding the selection of the best entrepreneurs.
Go Further:
– How The Legendary VC Arthur Rock Evaluated Startup Founders
– How Venture Capitalists Evaluate Successful Startup Founders
– Is Money The Main Driver of Successful Entrepreneurs?