Because venture returns are asymmetric, the deals a VC passes on are costlier mistakes than the deals it does. Listen
Ganesan said some investors pay up only to win, while others pay up because they see a bigger TAM, and in that case the price reflects a bigger opportunity rather than overpaying. Because losses are capped at the dollars invested and wins can return 10x or more, he said sins of omission outweigh sins of commission.
“the most expensive mistakes venture capitalists make are the deals they passed, not the deals they did.”
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