Unicorns Distract Us from a Graveyard – Understanding Venture Capital

Many investors have written about how they need some companies to win big in order to cover for other companies failing completely. As a simple example, Fred Wilson at Union Square Ventures tells his investors to expect a third of his investments to fail, a third to return their capital (which is also failure—they sell for a small enough amount that investors just get their money back, and in most cases the founders and employees get nothing), and a third to “succeed,” where his definition of success is that they return five to 10 times the original investment.

Source: Unicorns Distract Us from a Graveyard – Understanding Venture Capital – Medium