Gen Z Shaking up Venture Capitalism, Set to Rule the Economy
- Gen Z investors just expanded their venture capitalism presence with their first major event, per Axios.
- Venture capital firms are especially drawn to Gen Z for their trendspotting skills.
- It’s just one way Gen Z is set to take over the economy.
Gen Z is continuing to shake up the venture capital industry.
Friday saw the first major event hosted by Gen Z investors for Gen Z investors, which 3,000 people from more than 70 countries attended, according to Axios. It was cohosted by Meagan Loyst, a 24-year-old investor for VC firm Lerer Hippeau, who has taken to calling her cohort Gen Z VC.
Loyst coined the term in a November Medium article that went viral. Gen Zers, she wrote, were turning to venture capitalism as a gap year, to improve diversity in their region, to fill a hole in their local funding ecosystem, but also for one very important reason.
Gen Z knows how to spot trends, and that’s lucrative in the VC world.
The generation is an increasingly huge draw for venture firms, Axios reports, and firms in the space are hiring like crazy.
“I’m the target demographic for a lot of the companies that we’re looking at,” Loyst previously told Insider.
She created a Slack workspace of the same name the same month she coined Gen Z VC, and now it’s home to thousands of aspiring and full-time Gen Z investors. On it, they share how they broke into the industry, whether through lucky encounters with senior investors or a well-crafted cold email.
“People are seeing there’s not one typical path,” Loyst added.
Gen Z is set to take over the economy
Gen Z accounts for 30% of the global population, and VC firms will adapt to it and be shaped by it.
“What’s so unique about Gen Z VCs as it’s grown and scaled is that you see the power of Gen Z as a demographic, as opposed to just investors,” Loyst said.
Gen Z is certainly playing a larger role in the economy. They’ve emerged from the pandemic as the new “it” generation, with their oldest members turning 24 this year. It’s around this age and life stage that a new generation falls under the spotlight because they’re old enough to begin to exert their influence, Jason Dorsey, who runs the Center for Generational Kinetics, a research firm in Austin, Texas, recently told Insider.
It’s been a cultural shift, with Gen Z already leading the way in consumer trends that’s set to impact overall spending. TikTok, baggy jeans, and Y2K fashion have all gone mainstream this year thanks to the generation’s trend-spotting abilities. It’s big business.
In a little over a decade, Gen Z will be taking over the economy. Gen Z currently earns $7 trillion across its 2.5 billion-person cohort, according to Bank of America Research. By 2025, that income will grow to $17 trillion, and by 2030, it will reach $33 trillion, representing 27% of the world’s income and surpassing that of millennials the following year.
But they’re still a mystery to society, leaving Gen Z “shifting and driving much of the conversation,” Dorsey said, which he predicts they’ll do for the next 15 years. Since venture capitalists invest in the next big thing — whatever that may be — venture capital is a natural fit for Gen Z, which is increasingly flexing its muscles.
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