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Dear VCs, Just Give Up
gist
Michael Dempsey satirically tells boutique seed VCs to quit: mega-funds are crowding seed, only a handful of companies matter, founder sourcing is fully mapped, and AI-only herding plus two-year AGI timelines make a ten-year fund pointless. The closing inversion — that incumbents always crush upstarts, so managers should stop evolving — is the real argument. Consensus playbooks (SPVs into the same eight logos, chasing "legible" founders, abandoning every industry AI will remake) are what make a small firm obsolete.
ideas
- Mega-funds win seed by brand, not skill. A $5B fund will fight for 10-15% of a two-person company; founders pick the known name over a boutique that may not exist in a decade.
- Fewer companies are treated as consequential. Accessible intelligence concentrates outcomes; consensus says if you are not in OpenAI, Anthropic, Anduril, or a neolab, you do not matter.
- Legibility is sold as a solved sourcing problem. Elite schools, contests, and spinouts, plus CRM-mapped GitHub, PhD, and dropout pipelines, make the founder universe look fully known.
- All-in AI plus AGI timelines are a herd instruction. Putting the entire fund in AI, skipping every industry it will remake, and abandoning a ten-year fund because AGI is "2-3 years away" is the consensus he is mocking.
- The closing inversion is the thesis. "Incumbents destroy upstarts" is the opposite of venture history; giving up, rather than doing something slightly different, is what the essay forbids.
quotes
“The big funds are coming down to seed and they are going to do every deal.”
“And we now have learned that the most successful founders are the most legible.”
“The observable universe is known”
“Technology has taught us one thing over and over; that the big incumbents destroy the upstarts.”