In times of great technological upheaval, corporate fortunes change rapidly. We are seeing this in real time with the Data Supercycle. As data-driven upstarts surge, many traditional companies will struggle to keep up. For family offices, the message is clear: to preserve and grow wealth during a supercycle, one must lean into innovation. That means increasing allocations to venture capital – the asset class backing the next generation of market leaders.
Consider the stark evidence of how supercycles reshape the corporate landscape. The average lifespan of an S&P 500 company has plummeted from decades to years. In 1965, a company in the S&P 500 might remain there for roughly 33 years; today, the average tenure is under 20 years and shrinking. Projections suggest it may fall to 15-20 years this decade. In other words, incumbents are being replaced at an unprecedented rate by newer firms – a hallmark of a supercycle defined by rapid innovation. Indeed, since 1980, roughly 36% of the S&P 500’s constituents turn over each decade. That means in 30 years’ time (the length of a typical supercycle), almost the entire index can renew itself. And during especially disruptive periods, this churn can spike even higher, as paradigm shifts (like the advent of the internet or now data-powered AI) create waves of new entrants.
For a family office with a multi-generational outlook, these stats are a wake-up call. Relying on yesterday’s market champions may not suffice for tomorrow’s growth. Blue-chip stocks and indexes that worked in prior decades could lag or even implode if their businesses are upended by data-driven competitors. (e.g., think of how digital photography crushed Kodak, or how streaming overtook Blockbuster – now extrapolate such disruption economy-wide with AI.) In contrast, venture-backed companies are seizing the opportunities of the Supercycle. Data from the last decade is telling: Nine of the ten largest companies on NASDAQ were VC-backed startups in their early days. Moreover, entirely new categories of value are emerging from the data/AI revolution – from autonomous systems to personalized medicine – mostly led by agile young firms. To capture this growth, investors need exposure to venture-stage innovation where these future titans are being incubated.
Allocating more to venture capital during a supercycle is not just an offensive move for growth, but also a defensive one for relevance. A detailed 2025 analysis by Pivolt Global highlights “the myth of corporate immortality” – many public companies exit markets far sooner than expected, and “permanence is increasingly the exception” in forecasts. Their conclusion: traditional portfolios anchored too heavily in long-established firms risk “blind spots that erode long-term returns.” In plainer terms, if your capital isn’t participating in the new wave, it may be stranded in assets gradually losing their edge. Venture investing ensures you have chips on the table where the new value is being created, essentially future-proofing the portfolio.
Let’s address the why now question. Public tech stocks are roaring – why not just buy those? The reason is that by the time a company is a large-cap stock, a significant portion of its growth may have already occurred (captured by early investors). Supercycles concentrate value creation in the early years of new platforms. For example, the 2010s saw an explosion of smartphone apps and cloud services; the biggest returns went to those who built on top of Apple’s App Store or AWS: i.e., the venture investors in startups like Uber and Instacart building on those platforms. Now in the 2020s, the explosion is in AI and data-driven products. Many of the game-changers are still private, or even yet to be founded. Participating in venture funds or direct startup investments is the only way to access those opportunities.
In historical cycles, venture funds raised near or just after major public market highs have achieved returns exceeding public equities in the following years, particularly when valuations retrace. This pattern is supported by vintage-year analyses from PitchBook, Cambridge Associates, and others. Why? Because when an old cycle crests (often with public stocks overvalued or stagnating), it creates fertile ground for new disruptors to take root and flourish in the next cycle. Investors who shifted to venture at those inflection points were positioned to capture the rebound in value via the new entrants. We appear to be at such a juncture now: after a long bull run, public markets are volatile and arguably “coming off their peak” in some sectors, while a Cambrian explosion of AI/data startups is underway. It’s a classic passing of the baton.
To be clear, increasing venture allocation doesn’t mean abandoning all blue-chip holdings overnight. It means tilting the balance toward growth and innovation in your portfolio. Family offices might incrementally raise their target allocation to venture (for example, from single-digit percentages of the portfolio to mid- or high-teens, depending on risk appetite). This shift capitalizes on the unique dynamics of a supercycle:
In summary, a supercycle is precisely when a strategic allocator leans forward. Rather than fearing the unknown and clinging to the familiar, astute family offices embrace the change by funding it. As the Data Supercycle gains momentum, increasing your allocation to venture capital is a pragmatic step to ensure you ride the wave of innovation rather than being swept aside by it. In the next post, we’ll drill down further: within venture capital, not all strategies are equal. We’ll explore why early-stage investments, in particular, offer the most compelling way to capture supercycle gains (and why later-stage “growth” deals might not deliver the same punch in this environment).