Why are some venture capital funds structured as segregated portfolio companies?

Some venture capital funds are structured as segregated portfolio companies (SPCs) so limited partners can invest selectively in a circumscribed portfolio of startups. Segregated portfolio structures seek to ensure that the respective portfolios cannot be held liable for the debts or liabilities of other portfolios, creating a simple mechanism for demarcating assets. As such, investors can invest in different segregated portfolios, depending on their personal interests and valuations of the growth potential of each portfolio’s strategy.