thing these days.
If you model capital being called over a slower pace and distributions coming back earlier, you could theoretically get to annual returns of over 40% for a fund that only delivers 2x on committed capital.
Of course, annual rates of return are not the only measure that investors look for in a fund. They want to get the highest absolute returns they can get. And 2x is just not that exciting. I think 3x or better is what it takes to deliver top tier performance in the venture capital business and that's what we shoot for.
I'll post tomorrow a bit more on the 2x vs 3x issue. It's something I am constantly thinking about.
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