Small VC funds chase megafund-friendly deals for paper markups, says investor
arian_ghashghai · x · 2026-11-08
Kirby Winfield notes hundreds of pre-seed funds write $250k–$500k inception checks, so founders who can't raise likely have a pitch problem. Arian Ghashghai adds a darker take: in practice many small funds make investment decisions based on what megafunds like, since megafund-aligned deals are the most reliable path to paper markups and secondary liquidity for LPs. The result: money concentrates into fewer ideas and companies, orienting the market toward megafund preferences — the opposite of the idiosyncratic early-stage risk small funds exist to take. He says the data backs this up.
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