Late-Stage VC Optionality

In Antifragile – Things That Gain from Disorder, Nassim Nicholas Taleb defines an option as:

Option = Asymmetry + Rationality

* Asymmetry refers to a nonlinearity where the upside outweighs the downside — big wins when right, small losses when wrong. If your gains exceed your losses over time, you benefit

* Rationality is the ability to select the best opportunities and discard the bad ones

Optionality, then, is the ability to recognize a favorable outcome and secure the right  to capitalize on it.

US Late-Stage VC embodies this concept perfectly.

Tech venture capital operates in an Extremistan world, where winners enjoy uncapped payoffs. Early-stage VC funds hedge their bets by investing in a broad range of startups, prioritizing exposure over precision — it’s more critical to be in than to miss the one company that takes it all.

Late-Stage is the natural step after the early stage’s evolutionary selection & radical clean-up; an alphas-only ecosystem club. While it also adheres to a power-law distribution, it offers substantial (though much less extreme) upsides with significantly lower downside risks.

Consider this: Of the 4,369 startups founded in 2018, 61% have shut down, while just 1.1% (50) have reached Series D+ (Pitchbook).

US Late-Stage VC as an asset class provides:

1. Asymmetry – Greater and more frequent upsides than downsides

2. Rationality – Access to curated, high-potential startups, often through secondaries at valuations below their latest funding rounds

Conclusion

1 + 2 → With a relatively small commitment, Fabrica Ventures provides the optionality to exploit the US Late-Stage VC tech market