Can someone help me do some math here? Take these sentences:
"It was all about five investments in which we made 115x, 82x, 68x, 30x, and 21x."
"In our 2004 fund, we invested a total of $50mm out of $120mm of total investment in our nine losers. "
OK so in the 2004 fund we have $70mm being invested in companies with rates of return between 21x and 115x. Let's be conservative and say the total return on that $70mm was 50x. That means 70mm --> 3.5B. If we assume that's the total return on the fund we get 120mm --> 3.5B.
I am now going to assume these returns were realized over a period of 10 years. So that works out to about 40% gains each year (compounded 10 times).
Is USV really making 40% every year for a decade? Are other VCs doing that well? I knew these funds were good investments but I didn't realize just how good.
"It was all about five investments in which we made 115x, 82x, 68x, 30x, and 21x."
"In our 2004 fund, we invested a total of $50mm out of $120mm of total investment in our nine losers. "
OK so in the 2004 fund we have $70mm being invested in companies with rates of return between 21x and 115x. Let's be conservative and say the total return on that $70mm was 50x. That means 70mm --> 3.5B. If we assume that's the total return on the fund we get 120mm --> 3.5B.
I am now going to assume these returns were realized over a period of 10 years. So that works out to about 40% gains each year (compounded 10 times).
Is USV really making 40% every year for a decade? Are other VCs doing that well? I knew these funds were good investments but I didn't realize just how good.