[lepunk]

"...but there are hundreds if not thousands more startups that will make their founders and investors rich."

I think the correct word here would be "richer". For VCs 5x return on an investment while desirable, it's not the ideal outcome.

Consider a VC invests in 100 companies during X years, $1 million each. Ballparking here but 80 of these will be a total failure. 19 of them will make 5x return. That is -$100 million spent and $95 million gained. So if the last one is "only" a 5x return the VC gets their money back (-inflation, time spent, etc). Thats why they are looking mostly for Ubers and AirBnbs imho

[sangnoir]

> Ballparking here but 80 of these will be a total failure

Would those 80 still have failed if the mindset was "get 5x returns" rather than the current "get 100x - 1000x returns"?

My gut says the demand for high-returns results in "total failure" in many cases due to insane burn-rates in quest for "hockey-stick growth"

[lepunk]

That is a fair question, and a "what if" type so its hard to answer. if you assume an ideal world with sane CEOs than it shouldn't matter what the investors expect. The startup should burn cash at an optimal rate to achieve the highest profit. Of course don't live in an optimal world...