Where is the expression with the highest yield? The exclusive focus on power laws in venture capital is an oversimplification that ignores local constraints and actively managed decision quality.
Just because a power law describes a phenomenon does not mean it should be the only lens for portfolio strategy; in Hong Kong, prudential limits and sensitivity to Chinese policies are key factors.
We need to go beyond statistical observation to understand the performance levers under stress regimes and systemic shocks.
For example, a quick decision to exit an asset heavily exposed to regulatory change in mainland China preserves much more value than passive adherence to a theoretical distribution of returns.