Venture capital is an inherently risky business. Most venture-backed startups fail, so fund managers often count on just one big hit to juice an otherwise mediocre investment portfolios.
Six-year-old venture capital firm Juxtapose is betting that it can create a better track record. And in a sense, its startups can’t afford to fail. The venture studio, which creates its own startups, spawns just one to two businesses a year, a far lower number than rival investors. In fact, it has invested in just eight companies in its first mix of funds, which totaled $150 million overall.
While the venture capital model has clearly worked for the investors of businesses such as Facebook and Snapchat parent Snap, “the venture model wasn’t built for all companies,” says Patrick Chun, Juxtapose’s co-founder and managing partner. “We are maybe the opposite of a venture capital fund.”
By Lucinda Chen
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