The demise of non-consensus investment: VCs no longer judge the future but merely manage capital.

In the past three years, the most profound change in the VC industry has not been the difficulty in raising funds, the valuation correction, nor the exit pressure brought by the interest - rate hike cycle. Instead, it is a more hidden but more fatal trend - the systematic disappearance of non - consensus investment.

As leading institutions such as a16z and Sequoia Capital US have shifted to the RIA (Registered Investment Advisor) structure, established evergreen funds of funds, and expanded their cross - asset investment permissions, it may seem to be for flexibility, compliance, and long - term capital. However, the real logic behind this is that the industry is moving towards scale, institutionalization, and asset management, and the traditional concept of "venture capital" is being rewritten.

The "Non - Consensus Gene" is Being Diluted

In the past three years, the most prominent changes in the VC industry have been the difficulty in raising funds, the obstruction of exits, the valuation correction, and the interest - rate hike cycle. However, these are all cyclical phenomena. What truly determines the future direction of the industry is a deeper and less visible trend - the systematic disappearance of non - consensus investment.

This is not a path choice made by one or two institutions but a reconstruction of the underlying logic of the entire industry.

In 2019, a16z voluntarily gave up the "exempt status" of traditional VC and was fully regulated by the SEC (U.S. Securities and Exchange Commission) in the form of a registered investment advisor (RIA). This transformation allows it to invest in the public market, credit, structured products, and crypto - assets, improve the flexibility of portfolio adjustment, and build a "long - term asset pool" with permanent capital. With a wider range of asset choices, a16z has gradually evolved from an original "technology venture capital institution" into a "cross - asset capital platform."

The path of Sequoia Capital US is more symbolic. After launching the evergreen fund of funds in 2021, its U.S. business completely got rid of the constraints of the traditional fund cycle, and distributed allocation has become the norm. After the global split in 2024, the U.S. entity fully moved towards RIA, further strengthening its cross - asset capabilities and compliance mechanisms. The evergreen structure allows Sequoia Capital US to no longer be forced to exit due to the fund's term and enables it to flexibly manage its positions between the primary and secondary markets.

The RIA structure allows institutions to freely allocate across asset classes, invest in the public market, structured credit, crypto - assets, and hedge strategies, and even achieve a "perpetual capital pool" through internal fund rotation.

This shift is not a tactical choice but a forced one: the lengthening of the exit cycle, the narrowing of the IPO channel, and the fund's term becoming a constraint have made the traditional "10 + 2 - year" fund structure unable to adapt to more complex cycles.

The core mechanisms of non - consensus investment - information asymmetry, forward - looking judgment, and long - term patience are being continuously diluted by the institutionalized capital logic. This trend itself is the real crisis of the industry.

Venture Capital is Being Rewritten as "Asset Management"

The reason why the VC industry can generate returns has never been scale. Instead, it is that a few institutions can bet on the future with high confidence before a consensus is formed. However, as the industry becomes more large - scale, institutionalized, and strictly regulated, the core capabilities of VC are being rewritten - no longer about judging the future but about managing capital.

The transformation of a16z and Sequoia Capital US into RIA is the most typical symbol.

What institutions such as a16z and Sequoia Capital US are doing now is not just betting on early - stage projects. Instead, they participate in the entire innovation cycle through multi - asset allocation: investing in equity in the early stage, investing in structured tools in the growth stage, increasing or hedging positions in the public market, dynamically rebalancing in the secondary market, and lengthening the holding period through evergreen capital.

The logic behind these changes is clear: when exits become uncertain, the term is more important than judgment; when regulation becomes stricter, the process is more important than insight; when the scale becomes larger, certainty is more important than non - consensus.

Therefore, the judgment ability of VC is weakened, the capital structure becomes dominant, the information asymmetry is disappearing, and the non - consensus ability is being systematically and institutionally marginalized. The disappearance of non - consensus is not because no one wants to do it but because the industry structure no longer allows it.

The "Non - Consensus Window" is Shrinking Rapidly

When the capital structure is rewritten, the direct manifestations of the industry are: the centralization of funds, the homogenization of projects, and the fragmentation of windows.

The data in 2024 is particularly typical. Only 30 institutions in the United States absorbed 75% of the country's VC funds, and the single AI track swallowed 35.7% of the global funds. The median valuation of seed - round financing in the United States was pushed up to $14.8 million, and 28% of the rounds were flat or down - rounds (a 10 - year high) during the same period. The number of active VCs in the United States decreased by more than 25% in three years. The industry may seem bustling, but in fact, it is highly concentrated.

Foinsight has observed that the consequence of this centralization is the systematic shrinkage of the non - consensus window.

First, it has been shortened from "a few years" to "a few months."

The speed of technology diffusion has accelerated, and leading capital has reacted more quickly. The information asymmetry is almost instantly flattened, resulting in the previous step - by - step process of "observers - a few bettors - consensus formation" being compressed into "signal appears - leading capital swarms in - consensus forms instantly." Non - consensus is drowned by consensus before it has a chance to form.

Second, the project valuation shows a "high - opening and low - going" trend.

A few star projects push up the average, and most projects have difficulty in raising funds. The industry is experiencing a "false prosperity" driven by leading projects.

Third, small - scale VCs are being systematically marginalized.

They cannot participate in the consensus tracks and cannot access leading projects. Moreover, the non - consensus window is being rapidly squeezed.

The "dispersed exploration ability" on which the industry relies for innovation is being squeezed out of the ecosystem. As Martin Casado, a partner at a16z, pointed out: "It is more difficult than ever to use non - consensus as a source of alpha." Because the industry structure no longer allows it to exist.

The Fission of VC

As the non - consensus window shrinks, VC has changed from a "single industry" into two distinct capital systems.

One type is "consensus capital" - pursuing scale, efficiency, governance ability, and certainty.

Its characteristics include large - value checks, clear trend tracks (AI, biotech, enterprise services), heavy resource synergy, strong compliance, strong processes, and a huge amount of capital. The goal is long - term asset management rather than non - consensus judgment. Institutions such as the SoftBank Vision Fund, large - scale multinational VC/RIA platforms, a16z, and Sequoia Capital US fall into this category.

The other type is "risk capital" - betting on directions where the market has not yet formed a consensus, being deeply bound to technology, having small teams, high judgment ability, and information asymmetry as the real barrier, and relying on independent insights for returns. Institutions such as Benchmark, Founders Fund, and First Round still maintain this style.

But the reality is that the industry structure is continuously strengthening the former and weakening the latter. The reason is that the larger the scale, the more difficult it is to bear uncertainty; the more institutionalized, the more difficult it is to tolerate judgment errors; the more cross - asset, the more inclined to certainty; and the more process - oriented, the less likely it is to rely on the judgment of a few partners.

Now, the industry is shifting from "who can discover the future" to "who can carry the scale." In the future, the two types of institutions will coexist for a long time, but they will play completely different roles and missions.

Will VC Disappear in the Future?

The problem in the industry is not whether VC will disappear but that the definition of VC no longer holds. When capital converges, the structure changes, and venture capital becomes group - oriented, the value of "discovering the future" is squeezed. The VC industry needs to re - establish clear boundaries, including consensus capital vs. risk capital; RIA institutions vs. fund managers; resource - based platforms vs. judgment - based institutions; long - term capital vs. early - stage insights.

What really deserves to be emphasized is that institutions that are willing to take non - consensus risks are becoming scarce. Foinsight predicts that in the next few years, VC will have a clearer stratification:

First layer: Capital group - type institutions (RIA + multi - asset). Represented by a16z, Sequoia Capital US, etc., they are responsible for managing long - term capital, cross - asset allocation, and playing the role of industry infrastructure.

Second layer: Platform - type VCs (resource - driven, scale - coordinated). Centered around the ecosystem, network, and governance framework, they provide systematic empowerment for startups and are more like new - style investment banks.

Third layer: Insight - type VCs (non - consensus judges). With a controlled scale and a high - confidence partner team, they bet on the future in a few non - consensus windows.

Fourth layer: Professional early - stage funds (vertical depth). They focus on specific tracks and capture early - stage signals through research and professional capabilities.

In the future, the value of VC does not depend on "how large the scale is" or "how much assets are managed" but on "whether there are still a few people willing to bet when most people do not understand."

The value of VC has never been scale but "whether there are still people willing to bet before a consensus is formed." When the industry allows non - consensus to exist again, VC will return to its essence - the discoverer of the future.

How Should Family Offices Respond?

For most ultra - high - net - worth families, VC has often been regarded as a strategic allocation, a diversification tool, a channel for the next generation to participate in innovation, and a window to stay connected with the technology ecosystem in the past decade.

However, the structural reconstruction taking place in the VC industry makes its importance far exceed its financial significance itself.

Foinsight believes that the structural changes in the VC industry will profoundly affect three things for ultra - high - net - worth (UHNW) families - the logic of asset allocation, the ability building of the next generation, and how to understand future innovation. This means that UHNW families can no longer regard VC as a "single category" and must rethink:

In the past, it was about selecting funds; in the future, it will be about selecting strategic positions: Early - stage insight - type VCs need to take non - consensus risks; platform - type VCs need to provide certainty and resources; RIA - type VCs need to provide a long - term capital structure.

In an era of industry convergence, the scarcest ability for the next generation is not to see trends, look at valuations, or learn analytical models but to maintain the ability to make judgments in the case of incomplete information. Non - consensus is the real training goal for the next generation.

This means that family offices need to closely follow the investment research processes of top GPs, let the next generation participate in project due diligence, let them learn "how judgments are made," disassemble wrong decisions, and establish a "technology + mindset" system in real - world scenarios. Judgment ability cannot be learned in the classroom but must be learned from non - consensus windows.

Now, the entry point for technological innovation has gradually shifted from founders to capital platforms, R & D networks, global innovation ecosystems, and alliances between enterprises and institutions. If families do not understand the structural changes in VC, they will lose the main channel to enter global innovation.

In short, the VC industry is undergoing an unprecedented structural transformation. The shrinkage of the non - consensus window, the group - orientation of the capital structure, and the institutionalization of governance are jointly driving the industry from "discovering the future" to "allocating the future." In such an era, the scarcest things are not projects or technologies but institutions and families that can still maintain independent judgment and are willing to take non - consensus risks.

When the industry allows non - consensus to exist again, VC will return to its essence. And families that can build judgment ability in non - consensus windows will occupy the real high - ground in the future innovation cycle.

(Foinsight reminds that the content and views are for reference only and do not constitute any investment advice.)

This article is from the WeChat official account “Foinsight” (ID: foinsight), written by Foinsight and published by 36Kr with authorization.