> Startup investing is inherently about finding outliers: http://www.paulgraham.com/swan.html . Its alright if the median investment returns nothing as long as an outlier can return the entire fund. You might disagree with an entrepreneur aligning herself with investors that have this sort of thesis, but it's not accurate to say that the top funds perform poorly as a result.

Putting aside whether you believe that, after digging into the details, the performance of some subset of the top funds is impressive or not, you make my point: if the name of the game is trying to find those companies that will be outliers, we should be able to admit that venture firm pedigree and value-adds are unlikely to provide enough value to entrepreneurs to justify raising capital on less favorable terms than might be available elsewhere. After all, if many funds are made by one or a few investments, which is the case, it's clear that pedigree and value-adds aren't game changers.

So in the final analysis, you should agree that if you need venture capital, it's best to focus on the capital and pay as little for it as you can.