(Pitchbook) Over 40% of unicorns have been in venture portfolios for at least nine years, pressuring a hallmark of VC: the 10-year fund structure.
Companies with valuations of at least $1 billion now make up two-thirds of the US venture market. Their inability to exit is raising questions about the wisdom of the decade-long fund, according to a recent PitchBook analyst note.
In response to the IPO drought, VCs have requested fund extensions from LPs for vehicles at the end of their lifespans. They’re aiming to sidestep elevated rates, with the hope that IPOs increase soon.
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