Family offices and other LPs should underwrite both the GP and the thesis, but when forced to choose, the repeatable quality of the GP and firm platform matters more than any standalone fund thesis. Venture is structurally hard to time, so the core of the decision should be: “Is this a manager to back across multiple cycles?” rather than “Is this thesis perfect for this vintage?”. A fund thesis helps an LP understand where risk is being taken: sector focus, stage, geography, ownership targets, and value‑add model. It provides a framework to judge whether the GP’s strategy fits the family office’s mandate, risk budget, and existing exposure. The GP, however, controls sourcing, selection, portfolio construction, follow‑on discipline, and exits, and is ultimately responsible for whether the thesis is executed well or quietly abandoned when the market moves. Empirically, persistent outperformance in private markets is more associated with manager skill and process than with any one “hot” theme, which is why sophisticated LPs focus on GPs who deliver across cycles rather than one lucky vintage. When conditions change, a rigid thesis can become a liability, while adaptable GPs update how they apply it (e.g., entry pricing discipline, round positioning, reserve strategy). LPs are effectively buying a long‑dated relationship, so attributes like team stability, decision‑making culture, governance, and alignment (GP commit, carry, recycling) tend to drive long‑run outcomes more than whether a memo was AI‑ or climate‑focused. For family offices with limited bandwidth, a trusted GP also functions as an outsourced innovation radar and selection engine, which is often more valuable than trying to independently pick among shifting theses every cycle. This is why many institutional LPs will re‑up with core managers through style drift within defined bounds, but rarely tolerate degradation in team quality, processes, or alignment. Venture is a power‑law asset class at both the company and vintage level: a small subset of companies and a small subset of vintages drive disproportionate returns. Because it is impossible to know ex‑ante which vintage will contain the “power‑law” opportunities, trying to time commitments around macro cycles or public market sentiment is structurally unreliable. Analyses from private‑markets researchers show that skipping vintages to “wait for a better entry point” typically leaves portfolios under‑allocated for years and can permanently reduce compounded returns, even when later commitments are increased. VC deployment also lags fundraising and macro signals, so by the time a family office feels comfortable “getting back in,” many of the best deals in that cycle may already be priced and allocated. The practical implication is that VC is an asset class that rewards consistent pacing and diversification across vintage years, not tactical market timing. Maintaining a steady commitment plan smooths entry valuations, captures opportunities in both hot and cold markets, and allows distributions from older funds to support new commitments. For a given GP, it is unrealistic to expect every fund to be a top performer; even strong managers will have a “bad” vintage due to timing, sector cycles, or idiosyncratic portfolio outcomes. LPs that commit to several consecutive funds from the same high‑conviction GP are effectively averaging across the manager’s opportunity set and increasing the chance of being exposed to their standout vintages as well as their weaker ones. For family offices, the practical hierarchy often looks like this: * First, decide whether to have a strategic, long‑term VC allocation at all, given liquidity, governance, and risk appetite. * Second, select a small set of GPs whose teams, incentives, and processes are trusted enough to back through multiple vintages. * Third, ensure each GP’s thesis is coherent, differentiated, and complementary to the overall portfolio—but not so narrowly interpreted that a thesis tweak becomes a reason to abandon a good manager. Framed this way, a family office is not trying to time the VC market but to build durable GP relationships and maintain exposure across cycles, accepting that there will be weaker funds along the way while aiming for strong long‑run, multi‑vintage outcomes. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit verticescapital.substack.com
