Every investment firm has a story.
Our goal with Outlaw is to build the investment firm of the future You can’t do that without first understanding history.
For the past decade, I have obsessed with the idea of learning from the best investors, studying the architecture of iconic investment firms, and trying to operationalize those lessons in my own process of building one from scratch. It was time to move that research out of my notes and into a live document.
The Vintage Project is an open-source directory of the most iconic firms, funds, people, decisions that built them.
Full directory → https://vintageproject.io/
The first iteration details the stories of 18 firms, 247 funds, and 117 investors. We will slowly add more firms when they warrant the research.
Below are some of the high-level lessons from that research, what each firm did right, and how this ties into what we think the investment firm of the future will look like.
Condensing the last 50 years
As we wrote in Building the investment firm of the future, venture capital, up until recently, could be broken down into two different periods: institutionalization (1975-2000) and industrialization (2000-2025).
Institutionalization (1975–2000). When the VC industry first got started it was 20 people, all connected to Arthur Rock, a lot of whom were related. Investors were gatekeepers, all were monolithic brands, and the power dynamic favored them. This was a world where seed rounds typically dilute 50%, companies went public within five years of company formation, and founders were regularly fired or pushed out for “professional” CEOs. Pension funds began to touch the asset class, and the ‘70s were the first decade in which venture capital raised more than $1 billion. David Swensen took over the Yale Endowment in 1985 and pioneered a new form of portfolio management which encouraged an emphasis on alternatives. Reaganomics created a golden era for private equity. Firms began staffing up and expanding focus and geography. The cottage industry of venture was quickly disappearing and being replaced by something much larger and more complex.
Mayfield, Sequoia, Kleiner Perkins, and Accel dominated the 70s and 80s and benefited from lower competition and different power dynamics.
Benchmark, Index, and Coatue sprouted in the 90s right in time to take advantage of the dot-com boom.
Industrialization (2000–2025). The dot-com bubble let the genie out of the bottle and created more good than bad for the industry. The gold rush of younger talent minted the next era of founders like Zuck, Elon, and TK. Globalization swept the world and created an infinite stream governance-insensitive growth checks that delay the need for going public. The ‘99 repeal of Glass-Steagall eliminated the Four Horsemen investment banks which made it much harder for young companies to IPO. Marc Benioff introduces the world to software-as-a-service, recurring revenue becomes the North star, and the factory model of venture capital solidifies. Cookie-cutter founders built cookie-cutter vertical SaaS companies with cookie-cutter playbooks as software ate the world. Capital abundance brings changes to power dynamics. Founders no longer come to you; you come to them. The monolithic brands of the previous era begin to acknowledge their own inability to be everything so they start to appoint nodes. Neil Shen for Sequoia China. Chris Dixon for a16z Crypto. Dan Rose for Coatue Ventures. Some firms start to decentralize decision making to further acknowledge the importance of these nodes.
The 2000s were a golden decade with Lux, Lightspeed, USV, First Round, Founders Fund, Altimeter, and a16z opening their doors as the asset class started to prawl horizontally and vertically.
What each firm got right
Sequoia taught the stewardship model to never interrupt its compounding machine.
Benchmark taught the equal partnership model and limits to scale.
Kleiner Perkins taught franchise restoration and key-man risk.
Founders Fund taught the blueprint for alpha living at tails.
Union Square Ventures taught thesis-driven investing and audience-first funds.
Thrive taught conviction.
Lightspeed taught solving scale by hiring more specialists.
Mucker taught the idea that power law outcomes live outside the Bay.
First Round taught that goodwill is monetizable.
Ribbit taught the value of malleability.
Mayfield taught the great man theory.
a16z taught firm over fund and how to win capital agglomeration games.
Altimeter taught the art of subtraction.
Coatue taught how to monetize venture inputs.
Contrary taught person before company.
Lux taught that scientific research precedes capital formation.
Index taught that investment talent is the moat.
Predicting the next 50 years
Studying the history of these firms should be treated as required reading for anybody looking to build the investment firm of the future, but it should not be treated as a crystal ball looking forward.
We have entered into the next era after industrialization, and we see three primary trends that will define this period.
The 2030s will be the first decade that sees the slowdown of the historic logarithmic growth in venture-backed outcomes.
Tandem Computers went public at north of $10m in 1977.
Compaq broke the $100m barrier when it went public in 1983.
The ‘90s saw $1 billion IPOs like Netscape.
The 2000s had the first $10 billion+ IPO in Google.
Facebook broke the $100 billion IPO mark in the 2010s.
The 2020s will see a $1 trillion IPO in SpaceX, OpenAI, and / or Anthropic.
While we’ll see hundred-billion IPOs become table stakes, it is highly unlikely we see a flock of $10t+ companies (1/3 size of US GDP) going public over the next decade.
However, capital will continue to flood the venture asset class, underwriting baselines will grow to hundred-billion-dollar outcomes, and IRR compression will accelerate as inflowing capital outpaces exit scale growth. This will naturally incentivize venture franchises to seek new ways to deploy capital.
The industry structure will consolidate to a few incumbent institutions and a long tail of boutiques.
The former will adopt a multi-asset model to escape the local return crunch. Surplus venture capital will flow into tangent asset classes that traditionally belonged to LBO, credit, or public equities specialists as large-cap venture firms seek to diversify their revenue base by launching venture-relevant financial products.
Sequoia, Thrive, a16z, and Coatue are the poster children of this evolving definition of “venture capital”. They are the early movers, others who are capable will soon follow, and it will create ripple effects.
The boundaries between asset classes will deteriorate and become arbitrary to alternative asset managers.
Venture capital's rise to mainstream will bring long-overdue innovations to the innovation economy itself.
As retail capital floods in, clever financial engineers will invent the startup derivative and originate the options market for venture-backed privates.
Secondaries, continuation vehicles, and permanent capital structures will contribute to a more liquid private market where investors manage long/short positions daily.
Venture index funds will provide low-fee beta exposure to small-to-midsized allocators and degenerate retail gamblers alike.
Leverage will be introduced and popularized in every venture strategy.
Legacy corporations will utilize custom venture indexes to hedge against disruption, while startups and venture firms use the same instruments to juice returns.
Building the firm of the future
This all leads us back to the original purpose of this research project: what would the investment firm of the future look like if it were created from scratch in 2026?
To answer that question, you need to work backwards.
The dominant venture franchise 50 years from today is a financial superstore. It will sell capital to those building the future, while offering capital products to everyone who wants exposure to that future. Asset class boundaries have dissolved. The most successful firms look like the best alternative asset managers of today: platforms that started in one product and methodically expanded into every adjacent financial need of their customer base.
The dominant investment firm of the future will look more like Blackstone and less like Benchmark. Business building is the marketing, but asset management is the business model.
The investment firm of the future will not mirror the same path of the firms represented in The Vintage Project. It will take borrowed concepts and remixed ideas to continue the trend of expanding the definition of the venture asset class.
The deepest competitive advantage in that future state is investor talent, and the single best indicator of where venture returns will concentrate in any given decade is where the top 1% of young principals and junior partners want to work.
The firm that attracts, develops, and retains the best investors at the earliest stage (not by paying them the most, but by giving them ownership, autonomy, and a platform to run their own book) compounds talent the way the best funds compound capital.
If you have opinions on any of the above, I’d love to talk more. My email is [email protected].
