Sacks @ 01:02:24Inconclusive
venture
In 2022, Series A venture investments will outperform other venture stages (seed and growth) on a returns/multiples basis and will be the best area to invest in within venture capital.
I just said series A venture because it's pretty unoriginal. It's what I do. I think growth got a little bit overfunded and overheated. And I think the seed stage also there's like. So there was so many new seed investors. Again, it might have been partially because of excess liquidity. So series A is still the choke point. And I think it's still the best area to invest in. Innovation is not going to stop. There's going to be great series A investments next year.View on YouTube
Explanation
Available evidence doesn’t let us determine whether 2022 Series A investments actually outperformed seed and growth on a returns/multiples basis.
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Too early in the fund/vintage lifecycle
- Carta’s VC Fund Performance report shows that 2022-vintage funds had deployed only ~43% of their committed capital after 24 months, significantly less than prior vintages, meaning much of the 2022 capital (including many Series A checks) is still being put to work. (carta.com)
- The same dataset finds that median IRR for 2021–2022 vintages is still below zero and median TVPI is below 1×, and explicitly notes that we are “still years out from seeing the performance data” for these newer vintages. (twobytwo.notion.site)
- Venture funds are typically evaluated over 8–12 years, so by late 2025 we do not yet have mature, realized-return data for the 2022 Series A cohort.
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No reliable, stage‑by‑stage return benchmarks for the 2022 vintage
- Public benchmarks (Carta, PitchBook, NVCA, etc.) mostly report performance by vintage year and overall fund, not by financing stage (seed vs Series A vs growth) for 2022 deals. The available numbers (IRR, TVPI, DPI) are aggregated across stages, so we cannot see whether Series A deals specifically beat seed or growth on multiples. (carta.com)
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What we can see cuts in different directions, but is about valuations and volumes, not realized returns
- Multiple 2022–2023 analyses agree that late/growth-stage funding and valuations were hit hardest in the downturn, while seed was the most resilient stage; Series A/early stage sits between these extremes. (news.crunchbase.com)
- That pattern is consistent with Sacks’ view that growth was overheated, but it does not establish that Series A was better than seed on realized or even marked multiples—only that late-stage fared worst.
Because (a) 2022-vintage returns are still immature and (b) we lack clean, stage‑level performance data comparing 2022 Series A vs seed and growth, the prediction that Series A would be the best-performing part of venture on a returns/multiples basis in 2022 cannot be confidently scored as right or wrong yet.