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Only 37% of 2019 VC Funds Have Returned Capital: Inside the Numbers That Show Why VC Fundraising Has Gotten So Hard
- Only 37% of 2019 venture funds have returned any capital after 5 years, with even recent vintages struggling to distribute capital.
- In the 'Golden Age' of 2017-2018, the majority of funds saw positive returns, but the trend shifted with warnings signs as low as 7% of 2022 funds distributing capital.
- The performance crisis continued, with funds in 2023 showing negative median IRRs and a struggle for fund managers to meet return expectations.
- The industry faced challenges due to the valuation bubble burst for B2B and the freeze in the exit market, although signs of recovery emerged in 2025.
- The divide between AI-related investments and other sectors became evident, with AI-backed funds showing significant returns compared to traditional portfolios.
- The prolonged duration of holding positions by VCs, LPs facing distribution delays, and the struggle for fund survival without AI exposure were highlighted.
- Suggestions for the path forward included realistic valuation resets, exit market recoveries in 2025, portfolio rationalization, and fund strategy evolutions focusing on AI.
- The venture capital industry is undergoing a reset period, emphasizing the need for actual returns, sustainable businesses, and real value creation.
- Founders adapting to the new landscape have vast opportunities, while those without strategies aligned with the industry shift may face challenges and a 'venture capital winter.'
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