Passive Investing in Venture Capital and the Parallels to Public Equities

The article examines the rise of passive investing in venture capital as a parallel trend to public equities, where passive funds now constitute 54% of market dollars. As venture capital matures and company lifecycles extend to 11-13 years, later-stage companies increasingly attract passive investors who provide capital without active governance involvement. The author predicts venture capital will eventually see a similar split between active and passive management as the public equities market.