TLDR:
- A small but vocal group of start-up investors are forming new funds and taking new approaches to counter the swell of money into venture capital.
- Nick Chirls, along with Jonathan Wu and Mackenzie Regent, founded Asylum Ventures with a $55 million fund focusing on very young tech companies.
A small but vocal group of start-up investors, including Nick Chirls, Jonathan Wu, and Mackenzie Regent, are pushing back against venture capital’s changing focus on accumulating and deploying large sums of money. After running his own venture capital firm for nearly 10 years, Chirls decided to start a new kind of firm called Asylum Ventures with a $55 million fund to invest in young tech companies. This new approach involves making fewer investments over a longer period in companies that do not need to raise increasingly large funding rounds.
Traditionally, venture capital involved small groups of financiers backing young and risky companies that couldn’t obtain traditional loans. However, in recent years, the industry has seen a shift as investors poured billions of dollars into unproven start-ups with little diligence. This has led to a significant increase in venture capital managed, reaching $1.1 trillion in 2023 from $297 billion in 2013. As a response, this group of investors is taking a stand against the bigger-is-better mantra of traditional venture capital firms.
