Is VC Math Broken? - And Why the Next Unicorns Aren’t Just on the Coasts

Every month, I look forward to sharing the most interesting conversations I’ve come across, the insights that challenged my thinking, and the people who helped me get a little smarter and more informed along the way.

This isn’t just a roundup - it’s a reflection of what’s shaping the way I think about venture, healthcare, and innovation. Let’s dive in.

1. Is VC Math Broken? 

Full post here: https://shorturl.at/NCdBe 

That post from James Sedgwick-Heath - referring to a16z’s new $20B fund and the $640B in exit value needed to 3X it - sparked a wave of interesting conversations across VCs on LinkedIn, including Peter Walker.

What I’ve learned from them, and my take 👇

We’re really talking about two completely different versions of “venture capital”:

✅ One competes directly with public markets and is about the need to deploy very large amounts of capital.

✅ The other is about the opportunity to generate alpha returns and meaningfully drive innovation.

Too many of us are still trying to define the entire venture landscape by a single set of rules. But the truth is, “venture capital” now spans everything from $5M pre-seed funds run by solo GPs to $20B mega-platforms that have taken a large portion of market share from public markets in recent years. 

For LPs in a fund that size, 3X is not the expectation. They’re optimizing for:

✅ Exposure to late-stage private markets

✅ Brand association and signaling

✅ Pre- and post-IPO value capture

✅ Efficient capital deployment

Venture isn’t broken - it’s just that VCs are playing different games, and LPs get to choose the one that aligns best with their goals. 

2. Category-Defining Founders Don’t Just Live on the Coasts

Full post here: https://shorturl.at/M7k65 

You can find incredible founders in the most unexpected places.

In late 2021, we were visiting friends at UnityPoint Health Ventures and the University of Iowa when both told us, “You need to meet this health tech founder just down the road,” - which, as it turned out, was actually a 1.5-hour drive away.

That road led to Dr. Jon Lensing - a small-town Iowa doctor with a big vision to fix rural healthcare access. What he was building with OpenLoop wasn’t just another telemedicine platform - it was a rethink of how care gets delivered across America.

He had already signed clients, built sustainable revenue, and created real impact. Within a week, we were signing the term sheet.

Three years later, OpenLoop is one of the fastest-growing infrastructure companies in digital health.

You don’t always need to look to the coasts to find category-defining founders. Sometimes, they’re in a town of 400 - quietly building something transformative.

The most game-changing opportunities rarely announce themselves - and often show up where you least expect. But if you stay open and ready, they can redefine everything.

3. Small & Mid-Cap Healthcare Companies Are Now Trading at a 75% Discount to the Market

Full post here: https://shorturl.at/SDvGz 

Right now, small and mid-cap healthcare companies are trading at a 75% discount to the broader market - the steepest in over 20 years. But this isn’t about weak fundamentals.

It’s a perfect storm of:

• Capital flooding into mega-cap tech and AI
• Blanket de-risking of anything labeled “unprofitable growth”
• Policy uncertainty clouding investor confidence

The result? Strong, innovative healthcare companies with solid data and commercial traction are being priced like they’re broken.

But dislocations like this don’t last forever. When sentiment shifts, this segment could see one of the sharpest re-ratings in the market.

For long-term investors, this may be one of the most asymmetric opportunities out there.