General Catalyst Rewrites The VC Playbook As Software Buyouts Collapse

InnovationVenture CapitalGeneral Catalyst Rewrites The VC Playbook As Software Buyouts CollapseByJosipa Majic Predin,Contributor.Forbes contributors publish independent expert analyses and insights. I’m a founder, writer and lecturer focusing on VC funds.Follow AuthorApr 21, 2026, 04:19pm EDT--:-- / --:--This voice experience is generated by AI. Learn more.This voice experience is generated by AI. Learn more.HAMBURG, GERMANY - DECEMBER 28: Participant hold their laptops in front of an illuminated wall at the annual Chaos Computer Club (CCC) computer hackers' congress, called 29C3, on December 28, 2012 in Hamburg, Germany. The 29th Chaos Communication Congress (29C3) attracts hundreds of participants worldwide annually to engage in workshops and lectures discussing the role of technology in society and its future. (Photo by Patrick Lux/Getty Images)Getty ImagesGeneral Catalyst (GC) just published its first-ever quarterly investor letter, and the headline figure is not the $380 billion valuation Anthropic fetched in its Series G; it is the state of an entire asset class. CEO Hemant Taneja argues that software buyouts structured around terminal value, rather than cash flow, are now delivering negative returns even when the underlying business performs. The firm is betting $43 billion in AUM that the next era of private markets looks nothing like the last.The quarterly review, signed by Taneja, and published April 21, lands at a moment of maximum stress for growth-stage software investors. Public software multiples have compressed to roughly 12.7x EBITDA, compared to the 25x entry multiples that characterized 2019–2021 buyouts, destroying equity value even in businesses that grew EBITDA by 50%. Taneja runs the math explicitly: a hypothetical deal entering at 25x EBITDA, with the business performing, still returns 0.68x MOIC and a negative 7% IRR when multiples revert to current levels. The business succeeded but the investment model failed.The GC portfolio is not p...