A fresh start is needed after the misadventures of venture capital 

WeWork’s declaration of bankruptcy in November closed a revealing chapter in Wall Street history. The company’s failed IPO in 2019 became a cautionary tale of the wild excesses enabled by the venture capital (VC) funding model – in particular, VC’s ability to fund audacious bets, turn visionary founders into overnight billionaires, and burn investor cash by the barrel-load. A chastened WeWork ended up listed through a different, less demanding route, but its sketchy business model – taking out long-term leases on acres of office space and retailing access by the month – ran headlong into the COVID-19 pandemic, leading to a disastrous collapse in its share price.

It’s not just WeWork that has disappointed retail investors. The American stock market is home to hundreds of tiny money-losing companies whose valuations drop after they go public. What gives?

Now is a good time to re-evaluate the role of venture capital in the economy. VCs have fundamentally distorted our…