Abraham Thomas on venture capital and startups

Last updated: 29 September 2026

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Abraham Thomas analyses venture capital through a former bond trader’s lens, and his central idea is that time is venture’s key variable: “If Wall Street is in the business of spatial arbitrage, Silicon Valley is in the business of temporal arbitrage.” Staged funding rounds make startup financing legible; compressed timelines made venture look less risky than it was, a Minsky boom he described in February 2022, at the peak. On startup execution, his main argument is that speed reduces risk rather than adding to it.

His perspective combines three vantage points:

• Quant trader: a bond arbitrageur and portfolio manager at the hedge fund Simplex (1998–2006).
• Founder: co-founder of the venture-backed Quandl, which raised about $20 million from August Capital, Nexus Venture Partners and others and was acquired by Nasdaq in 2018.
• Angel investor: backer of about 40 pre-seed and seed startups.

Key ideas

Is venture capital prone to boom-and-bust cycles?

Yes, Thomas argued in February 2022. Faster markups, faster rounds and faster fund deployment made the venture J-curve disappear, lowering measured risk and drawing in more capital: a Minsky boom. Anything that slowed funding cycles could reverse it: startups delaying raises, VCs lacking markups to raise their next funds, and LPs cutting allocations. By May 2022, Refinitiv’s venture capital index was down 45.8% for the year, and FT Alphaville quoted his conclusion and called it “pretty on the money”. Details: Minsky Moments in Venture Capital (summary).

What is temporal arbitrage in venture capital?

Futures markets made commodity supply chains efficient by dividing them into stages and defining each handoff. Venture does the same across time: seed, Series A, B and so on, each with benchmarks and specialist investors. This makes venture legible and unlocks huge capital inflows (“efficiency unlocks volume”). It also explains why VCs are consensus-driven, why modern multi-stage firms act as market makers rather than price takers, and why a few venture majors, aiming to become “the investment banks of the technology world”, attract a growing share of LP capital. Details: Making Markets in Time (summary).

How should startups think about risk and speed?

“Speed is the single best way to de-risk a startup.” Startups are both unknown (everything must be discovered) and unforgiving (most are “default dead”). Speed is their only sustainable advantage, gives more shots at goal, and guards against founder burnout. Amundsen reached the South Pole with a third of Scott’s funding and a fifth of his men by optimizing everything for speed; Scott’s slow, heavily planned expedition ended in tragedy. Details: The Perils of Prudence (summary).

Two shorter essays apply the same logic of learning fast to experiments and decisions: The Worst Outcome Is a Mediocre Success and Strong Opinions, Weakly Held.

Essays