While doing graduate school at Harvard, I co-authored a paper with Harvarad Business School Professor Andy Wu on the shortcomings of the standard venture capital model, and how a more distributed model ought to be more resilient to venture's common failure modes. We call them "Distributed Venture Firms."

Much of that research became the raison d'être for Seed Labs.

Abstract

Using a combination of incentive modeling and empirical meta-analyses, this paper provides a pointed critique at the incentive systems that drive venture capital firms to optimize their practices towards activities that increase General Partner utility yet are disjoint from improving the underlying asset of startup equity. We propose a "distributed venture firm" powered by software automations and governed by a set of functional teams called "Pods" that carry out specific tasks with immediate and long-term payouts given on a deal-by-deal basis. Avenues are provided for further research to validate this model and discover likely paths to implementation.

Read the full paper here.