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Table of Contents

• VentureStaking® Arenas: The Pre-Seed Venture Fund …

  • Part 1 of 4 - The Setup

  • What Venture Really Is

  • The squeeze on emerging managers

  • Emerging VCs are founders too

My name is Gerry Hays, Founder & CEO of Doriot® (pronounced “Doe-ree-oh”), named after French-born American U.S. General Georges Doriot, the father of Venture Capital.

I’m also an author (First Time Founders’s Equity Bible), inventor (U.S. patents for ads on t-shirts, coat checking, and VentureStaking® - pending), and 21-year professor of venture capital and entrepreneurial finance at Indiana University.

Democratize Venture is my platform to explore the venture markets and share the insights, strategies, and frameworks I bring into the classroom. It’s where practical advice meets mindset meets execution—for anyone ready to play the startup game.

VentureStaking® Arenas: The Pre-Seed Venture Fund of the Future

Part 1 of 4 - The Setup

Part 2 of 4 - Pre-seed is the holy grail

Part 3 of 4 - Organizing around retail

Part 4 of 4 - The economics of owning an Arena

These are excerpts from the upcoming Doriot® Whitepaper on VentureStaking® Arenas — a new venture platform designed for emerging fund managers seeking a competitive edge.

Part 1 of 4 - The Setup

The hottest area in venture capital right now isn’t really venture at all — it’s the secondary markets. Seemingly overnight, broker-dealers and funding portals like StartEngine have launched new business lines giving accredited investors access to private shares of companies like OpenAI, SpaceX, Anthropic, and others.

According to PitchBook, the secondary venture market has ballooned from $25 billion in 2012 to $122 billion today, largely because the IPO market has dried up.

Now, I don’t doubt that someone can make money buying SpaceX stock at a $500B valuation. But let’s be honest — that’s not a venture play. For a 10x return, SpaceX would need to be worth $5 trillion. Possible? Sure. But how long will that take? And when can you cash out?

If it takes seven years and there’s still no IPO, suddenly the math starts looking worse than the public markets. Or worse, they go public at $300–400B and you’re underwater from day one. High risk, limited upside. That’s not venture.

What Venture Really Is

Venture is high risk, high upside. It’s about getting in early enough to capture asymmetric returns, but only once there’s enough signal to suggest something real is there. That moment — when risk still outweighs certainty but signal begins to emerge — is where true venture lives.

The problem? Thousands of funds and billions of dollars are fighting tooth and nail to find and enter those deals.

And right now, three dominant players are shaping the rules of the game, leaving everyone else to either follow their lead — or try to invent something new.

Accelerators - Y Combinator (YC)

YC reviews tens of thousands of applications each year and selects a few hundred promising teams. It gives them capital, a network, and a 90-day sprint to build something consequential. Other accelerators exist (Techstars, etc.), but YC is the top dog.

Many Bay Area funds depend on YC for deal flow. They try to curry favor to get invited in. Bidding wars break out constantly. YC has the ball and the bat.

VC Expansion to RIAs - Andreessen Horowitz (a16z)

On the institutional front, top-tier VC firms have significantly expanded their roles beyond traditional early-stage investing in recent years. Rather than limiting themselves to seed or Series A rounds, these firms are evolving into multi-stage capital platforms, deploying capital from seed through to pre-IPO.

Take a16z, for example — it’s no longer just a venture firm. It has become a media, services, and platform powerhouse, offering not only funding but also deep infrastructure: editorial support, talent networks, legal resources, and more. Sequoia and Lightspeed have embraced similar transformations.

Founders actively seek out these firms. Their brands attract top deals. And where they lead, other funds tend to follow.

Studios - Antler 

Then there are models like Antler, a kind of startup studio on steroids, launching hundreds of founders with built-in capital and downstream funding support. It’s a tremendous model — but not one that can be easily replicated.

Antler is successfully building its own ball and bat.

All of these players are advancing what’s essentially an arms race. The biggest brands offer more resources to founders, take more territory, and gain more control. Their scale forces others to play by their rules — or not play at all.

And even with all that infrastructure, these models still barely scratch the surface of total founder demand. The top players get to skim what they perceive to be the cream of the crop, handpicking startups through tightly controlled selection processes — while the rest of the global founder ecosystem is left to cobble together small checks just to get started, along with all the expenses, delays, and complications that come with it.

And let’s not forget: no one truly knows where the next breakthrough will come from — or who it will come from. The decisions made by these gatekeepers aren’t guarantees. They’re bets, just like everyone else’s.

The squeeze on emerging managers

Meanwhile, emerging fund managers are playing the same game — but without the same gear.

They don’t have the brand pull or the proprietary deal flow. They’re often beholden to other people’s origination and struggle to differentiate. They need to build track records to win LPs, but track records take years to mature. And even when they get into competitive deals, the valuations are already inflated — limiting returns.

And as for retail investors? The door isn’t even cracked.

So we’re left with a venture landscape where, through selection, the early deals are eaten up by the dominant players, while everyone else scrambles to stay relevant.

Emerging VCs are founders too

Some might think this is a first-world problem. But let’s set the record straight:

Emerging VCs and syndicate leads are founders.
They’re building platforms. They’re taking risks. They’re launching new ideas into the market. The difference? Their product isn’t an app — it’s an investment thesis.

Like all founders, they’re under-resourced, underestimated, and facing long odds.

But in today’s market, the systems and access points still overwhelmingly favor incumbents. And the result is a venture world where a small group controls the perceived upside, while everyone else competes for allocations. Networks can only take them so far, what they need is a sustainable competitive edge.

In other words, emerging VCs need their own ball and bat. That’s where owning and operating VentureStaking® Arena comes in.

Next Week: Part 2 – Pre-Seed is the holy grail

Wishing you a focused and fulfilling week,