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Comment by tasuki | Hacker News Reader

> VCs are expected to generate a 25-35% annualized return compared to the 12-15% that public equity markets generate and much higher than the 8-10% return that debt markets give.

What does "expected to generate a 25-35% annualized return" mean here? Is that the mean/average annualized return of a VC fund? Or the "wished for" annualized return?

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It's a very aspirational target. 25% annualized return (after fees) is a top decile fund. I've heard that number as a target before, but rarely and from investors that weren't used to the market. 12-15% from public markets is a top quartile hedge fund, still a great return but a little less aggressive than the VC number.

Under this definition, it would seem as if Andreesen Horowitz is not anywhere close to a top decile fund[1]. Does anyone know which ones are? Data on VC returns seems hard to come by.

[1] https://www.theinformation.com/articles/andreessen-horowitz-...

For industry wide statistics, something like https://www.cambridgeassociates.com/wp-content/uploads/2018/... is pretty good. All returns there are gross, not net, but they show top quartile funds returning 15-20% gross over the last decade, varying a bit year to year.

For specific fund performance, I don't know of anything public. Most of the big names have had some funds with >20% returns, usually as they get bigger those get harder to maintain.

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