ALL INPredictions
Last updated Nov 29, 2025
Prediction
Chamath
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Chamath @ 00:32:25Inconclusive
ventureeconomy
The roughly $1 trillion of venture capital raised in the recent boom (around 2021–2022), currently marked at about $5.5 trillion in paper value, will ultimately realize only about $1.6 trillion in distributions to LPs as returns revert to the historical industry average of roughly 1.6x paid-in capital, implying that approximately $3.9 trillion of current paper valuation will be lost over the full realization cycle (about 10+ years).
over many cycles where we've had high rates and low rates and medium rates, our industry typically returns $1.60 for every dollar it raises. And that's over many cycles. And so if you believe that we're going to revert to the mean out of the trillion dollars we've raised, maybe we'll return 1.6 trillion. Now that sounds good. Except the problem is that 1.6 trillion is marked at 5.5 trillion. So you're going to have to give back... you're going to have to give back a lot of paper profits in order to get back to that 1.6 and be okay with it.View on YouTube
Explanation

As of November 30, 2025, the prediction cannot yet be evaluated. The funds that raised the roughly $1T of venture capital during the 2020–2022 boom are only about 3–5 years into their lives, and venture funds typically take at least 7–10 years—and increasingly 15–20 years—to fully return capital to LPs, with DPI usually remaining well below 1.0x in the first 5–7 years. (phoenixstrategy.group) Public data on recent vintages shows that 2021–2022 VC funds have very low realized DPI so far (often around 0.1–0.3x or even zero), and many 2021 funds have not yet made any distributions at all, underscoring that most value is still unrealized. (equitybee.com) While we do know that (a) U.S. VC assets under management surpassed roughly $1.1T by 2022 and global fundraising/dry powder reached record levels—consistent with Chamath’s “about $1T raised” framing—and (b) exits and valuations have fallen sharply since the 2021 peak (global VC exit value dropped from about $1.4T in 2021 to roughly $309B in 2022), it is impossible at this stage to say whether the final DPI on this capital will converge to ~1.6x paid-in (≈$1.6T in distributions) or end up materially higher or lower. (nvca.org) No comprehensive study as of 2025 projects ultimate distributions for the 2020–2022 VC fundraising cohort in the precise way Chamath describes, and the realization horizon he himself assumes (“over many cycles” / “out of the trillion dollars we’ve raised”) is on the order of 10+ years, which has not yet elapsed. Therefore, the quantitative prediction about ending up with only ~$1.6T in distributions and ~$3.9T in lost paper value remains untestable today.