Neo’s early bets — Kalshi, Cursor — propelled its first funds to returns few 2021 vintage firms can boast

A small fund, a big multiple

It has been reported that Neo, a venture-capital shop few had on their radar, turned a $150 million 2021 fund into roughly $1.2 billion in paper value. That kind of multiple is eyebrow-raising on its own. Even more striking: it has been reported that the strong marks pushed the value of Neo’s first two funds well above industry averages for that vintage. Surprise? Absolutely. Expected? Not really.

Bets that paid off

The firm’s early stakes in startups such as Kalshi — the regulated event-contracts exchange — and Cursor — a developer-facing AI editor — are being credited with much of the uplift. It has been reported that those positions, taken when valuations were still modest, accounted for outsized gains as markets shifted and certain sectors—prediction markets, developer tools and AI—came into vogue. Timing matters. A lot.

Why it matters now

Vintage 2021 has been a tough crowd for many funds: public-market volatility, cooling rounds and a reset in multiples left lots of portfolios underwater or flat. Neo’s results, if they hold up on exits, would be a reminder that concentrated, early-stage bets can still generate knockout returns even in a patchy cycle. Can they repeat the feat? That’s the million-dollar question — or, given this story, the billion-dollar one.

Sources: wsj.com