Venture Capital for All

April 2025 

Eric Rosenfeld 

In times of great economic uncertainty, the appeal and benefits of venture capital, including place-focused funds like the Oregon Venture Fund, become more evident. Offering less volatility and correlation with public securities, the opportunity for long-term outperformance, and the warm fuzzies that come with helping create local jobs and wealth, regional funds like the Oregon Venture Fund can help investors sleep a little better at night.  

Much of the wealth being created today is accruing outside of the public markets. Those experiencing the most rapid economic mobility are more likely to be business owners and investors with significant exposure to private equity, venture capital, and real estate. University endowments – famous for being managed by savvy, successful, patient professionals – allocate on average 30-40% of their investable assets to VC and PE managers.   

Since 1996, the number of publicly listed companies on the NYSE has dropped from 8,000 to a little over 2,000 today. Contributing factors include M&A, a decline in IPOs, and heightened regulatory requirements from the Sarbanes-Oxley Act of 2002. During that same period, the annual amount invested in US venture capital grew from $10B to $210B. Top performing funds like OVF are averaging an 18% long-term annualized net return, or better, [vs. 9% for the S&P 500 for 2007-2024] and are doing so in a manner that’s less volatile and less correlated with what’s occurring on Wall St. The unfortunate fact for most investors is that the bulk of the value and wealth being created today is generated by companies that aren’t public, and are likely never to go public, and simply are not accessible to most retail investors. By the time a rare company does IPO, the bulk of the upside has already accrued to venture investors, founders, and employees, and the rate of annual valuation increase has likely slowed with size.   

At present, the SEC limits venture capital access to accredited investors [net worth >$1M or gross annual income of >$200,000] and caps the number of participating individuals in a fund at 250. This is one reason why OVF creates a new fund each calendar year – that is, to accommodate more investors. Additionally, to make venture capital’s wealth-creating potential more accessible to individuals and families, OVF’s minimum to invest is just $50K [vs. $500K or more at comparably sized funds]. Institutional investors in OVF must invest a minimum of $1M over 5 years.  

The drawbacks of venture capital are real and include: 

• High risk – Over 60% of OVF’s investment fail to generate a positive return.  

• Lack of liquidity – Our mean time to liquidity for an investment is currently 8 years and it can take 10 to 20 years for a fund to make its final distribution.  

Because of the long duration of venture investments, some OVF investors hold their investments in trusts for the benefit of their kids or grandkids.  

If you have questions about any of the above or would like to learn more, please contact OVF’s head of investor relations Melissa Freeman at Melissa@OregonVentureFund.com. She might even be able to help you sleep a little better.