Dear friends and partners,
This year — like most — offered both confirmation of our deepest convictions and surprises that humbled us. We will try, in the pages that follow, to be honest about both.
On the State of Capital
The single most consequential development in venture capital this year was not the AI boom, nor the partial recovery of the IPO window. It was the quiet recognition, across the most thoughtful corners of our industry, that the ten-year-fund construct has been straining for some time against the realities of building category-defining companies. The best founders are now building over fifteen, twenty, even thirty year horizons. The best investors are quietly extending their holds.
We have always believed this. A family-fund structure was, for us, never merely a tax convenience — it was a philosophical commitment: that capital should outlast the cycle, and so should conviction. We say this not as criticism of LP-funded structures, which serve their purposes, but as quiet pride in our own. In 2024 we held positions across our portfolio that any decennial fund would have been pressured to exit. Several of those positions doubled this year alone.
Patience, properly applied, is not the absence of action. It is the most demanding form of discipline we know.
On Artificial Intelligence
We deployed more capital into AI in 2024 than in any previous year, and we expect to deploy more in 2025. We will not pretend to have a unified view on whether the foundation-model layer is durably defensible — reasonable people disagree, and we have positions in companies that bet on opposite answers. What we are certain of is that the application layer is dramatically underbuilt relative to the infrastructure capacity now available. Our enterprise-AI investments have, almost without exception, found themselves buying GPUs cheaper than they expected and shipping faster than they planned.
We continue to favor companies that are AI-native rather than AI-augmented — firms whose core workflow could not exist without modern models, rather than firms that bolted AI onto an existing process. The distinction matters because the former compounds with model improvements, while the latter often gets disrupted by them.
On Biotechnology & the Long Patient
Biotechnology has been a humbling sector for us, as it is for everyone honest about it. The gap between scientific elegance and commercial outcome remains wide. And yet 2024 saw three of our portfolio companies advance compounds into late-stage trials that would have been considered impossible a decade ago. We are participating in a discontinuity in human capability whose implications we will not fully understand for a generation.
Our approach in this sector remains contrarian: we underwrite the science, we underwrite the team, and we then write the check we would be comfortable writing again at the same valuation in three years. The math forces discipline.
On Geography
Our Asian heritage and global footprint continue to be our quiet edge. The decoupling narrative is overstated; the most consequential companies of the next decade will need access to talent, capital, and markets across at least three continents. The funds that limit themselves to a single region — whether by mandate or by habit — will be increasingly disadvantaged.
We opened our London office a decade ago, when fewer Asian funds did. We are evaluating a fifth office now. The world remains larger than any one coast.
On Generational Continuity
The most personal news of this year is that the second generation of partners has formally joined the firm. Family-fund structures have their own version of the founder transition problem, and we have spent more years preparing for this than perhaps we should admit. We are gratified that the values, the discipline, and the patience that defined the first twenty-seven years are now in hands we trust completely. The next twenty-seven will, we believe, look different in detail and identical in character.
A Closing Note
The companies we are most proud of were not always the easiest to write the first check into. They were the founders who took longer to convince us, the theses that required more reading, the markets that needed more imagination. In 2025 we will continue to favor the longer conversation over the faster decision.
Thank you for being part of this work.
The Partners
Winzheng Family Investment Fund · December 2024