CHAMATH PALIHAPITIYA, AN early Facebook executive and outspoken presence in Silicon Valley, is unapologetic about his frustrations with the venture-capital industry. There’s too much money chasing deals, making it harder to generate strong returns. Too many VCs conflate luck with talent. And everyone who benefits from the current system is resistant to change.
Technically, Palihapitiya is a venture capitalist himself. But he aspires to be a master of the universe, as his firm, Social Capital, expands with separate funds for late-stage investing, debt, and public equities. Founded in 2011 to back early-stage startups, Social Capital now manages $1.8 billion worth of assets. It looks less like a traditional venture-capital firm and more like a tech-focused private-equity conglomerate. Palihapitiya takes inspiration from Warren Buffett’s model of investing in and acquiring companies for the long term. “I want to fucking dominate this industry,” he says, punctuating each word with a table pound.
As it expands, Social Capital is losing core members of its initial team. Co-founder Mamoon Hamid abruptly left last month to join Kleiner Perkins Caufield & Byers. Now, the third co-founder, Ted Maidenberg, also plans to leave the firm, according to people familiar with the matter.
[ Wired ]
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