Whereas before investors actually had ideas, today they focus on managing risk. Very rarely in the hedge fund world do people ask questions about what’s going to happen in the future. It’s less, “What should we do?” and more, “How do we manage risk? Yet again, process trumps substance. Venture capital has fallen victim to this too. Instead of being about well-formed ideas about future, the big question today is how can you get access to good deals. In theory at least, VC should have very little in common with such a statistical approach to the future.
--Peter Thiel
From a very fascinating class notes on his CS183 lecture "You are not a lottery ticket."