Venture capital firms (VCs) suffer with exits more than private equity (PE). Traditional wisdom suggests that they invest earlier in the life cycle and have to wait longer for the exit. Is this the real reason?

The past two years have been challenging for distributions for both VCs and PEs, especially the former hitting a 14-year low of 5% in distributions as a percentage of net asset value. Average distributions to paid-in capital (DPI) for VC funds launched in 2018 stand at a meager 0.3 times for both EU and U.S. managers, while DPI for funds launched in 2013 is at 1.1 times and 1.8 times, respectively. READ MORE