Typically venture capitalists will initiate investments over the first two or three years of the fund. You don't know which years are going to be good or bad. So you want to be really sure that you're not taking all your powder and putting it in funds together in one year. You diversify over time and sectors. For example, if you're going to start a venture capital investment program, you don't want to jump into investment funds started in the year 2000.
Venture capital is an industry that continuously reinvents itself.
The biggest changes taking place are less in terms of the kinds of deals that are being done and the deal process, and more in terms of the way the industry is coming together. A lot of what we're going to be seeing in the next few years are efforts to try to consolidate, build scale, and build a better infrastructure within the venture groups themselves. Various new classes of investors have come into the market, such as public pension funds that until recently hadn't invested in venture capital. We've also seen a lot of interest on the part of individual investors, through funds of funds through investment banks and other intermediaries, and less traditional mechanisms like MeVC and public venture capital. It's natural that public pensions would want to put some of their long-term assets in illiquid investments.