VC is Dead, Long Live the Capital Allocator: Why the Game Just Changed Forever

Let’s talk about the death of traditional venture capital.

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Harry Stebbings, the voice behind The Twenty Minute VC, just dropped a bomb. He said what everyone in Sand Hill knows but won't tweet: venture capital isn’t the sexy, high-margin game it used to be.

In fact, it’s becoming a commodity.

What Just Happened?

According to Bain & Company’s 2025 report:

• VC funding surged by 24%, mostly thanks to AI.
• But returns? Flat. Saturated.
• Early-stage rounds now average $25 million, crowding out lean bets.
• And Lightspeed—yes, Lightspeed—walked away from the traditional VC playbook.

Translation: Too much money. Too many firms. Not enough unique ideas.

From Alpha to Admin Fees

Once upon a time, VCs lived and died by carried interest. You made a killer return, you got paid. Now?

It’s all about management fees.

Ed Suh nailed it: firms are shifting from “find the next Stripe” to “manage AUM, collect fees, stay alive.” It’s less hedge fund, more asset management.

And Harry’s take reflects what insiders whisper: the real action is now either at the super early stage (pre-seed/seed) or further upstream—in private equity.

What’s the New Game?

Simple: capital allocation is fragmenting.

VCs are morphing into full-stack investment firms. Blending early-stage bets with growth equity, even dabbling in PE.

Because the old model—spray, pray, wait 10 years—isn’t enough. You need new weapons in the war for alpha.

So, Who Wins in This New World?

✅ The firms who can flex across strategies.

✅ The ones who get distribution.

✅ The ones who systematize how capital meets opportunity.

Enter: Capitaly.vc

Here’s why Capitaly is built for this shift:

• We’re not just a CRM. We’re the dealflow engine for capital allocators across VC and PE.
• We give firms the ability to adjust to strategy pivots—whether you're raising for a seed fund or sourcing a $100M growth buyout.
• Our tools don’t care if you’re a solo GP, multi-stage fund, or crossover asset manager. We give you clarity, velocity, and signal in a noisy market.

When the industry gets commoditized, brand, speed, and systems become your edge.

That’s Capitaly.

TL;DR

• Venture capital is being commoditized.
• Returns are shifting upstream and downstream.
• Fees are the new carry.
• Firms need flexible, intelligent GTM for fundraising and dealflow.
• Capitaly.vc is the bridge between VC, PE, and whatever’s next.

If you're a capital allocator adjusting to the new rules of the game, you don’t need a tool.
You need a playbook.

👉 Subscribe to Capitaly and raise capital at the speed of AI.

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