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Key Takeaways Venture capital is plagued by a “herd mentality,” favoring known founders and stagnating technological progress.
Gatekeeping by elite institutions and academic achievements dictate funding, marginalizing unconventional talent.
Minority founders face significant challenges but must strategically navigate the VC ecosystem to succeed.
Venture capital is in crisis. We’re staring at the greatest technological shift in history, yet the industry reeks of laziness and stagnation. Sure, liquidity’s not great, slashing available funds for founders.
But the real killer? Economic jitters that birthed a “herd mentality” — investors are piling into the same deals and only giving capital to founders they know. VCs were meant to level the playing field — rewarding merit, ingenuity and grit. However, in 2025, it has devolved into a commingled piggybank to bankroll technofeudalist ideas from nepo-babies.
Prejudice runs deep, but inflation fears contribute to the rising terror of failure. These fears drive market participants to collude to deliver value to shareholders rather than deriving that value from bets of their own volition. Effectively, modern venture capitalists act no differently than high school mean girls in suits.
Behind the curtain: Gatekeepers exposed
“Iron sharpens iron,” implying that competition brings out the best in one another. The same applies to companies — competition breeds the best product, ultimately maximizing value delivered to end-markets. But as venture markets matured, bureaucracy crept in like a virus. Accelerators and elite programs turn raw, punchy ideas into a badge-collecting game. Want funding? Forget brilliance, stack endorsements.
Ivy League institutions, YCombinator and Forbes 30 Under 30 are a few examples of conglomerates that gatekeep capital — and indirectly — the advancement of mankind. Investors hide behind them as filters for talent when, more often than not, the scrappy, underserved founder mentality lives outside of these bubbles. Outsourcing this diligence quite literally undermines the value of a fund manager in the eyes of shareholders. After all, LPs back managers based on their unique experience and world perspective. That’s like hiring an attorney who outsources to ChatGPT.
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