If you think VCs are rational, you’d be in for a fun ride.
LPs will see this as reducing the likelihood of making their money back via investing in VCs -- or at least, this is a reasonable theses, and those that grow their customer's funds the most might make this assessment. In the long-term this would transform the landscape of VC which is downstream from institutional investors.
It can also have a cascading effect due to how reports and disclosures over investment strategies get shared and firms benchmark themselves against leading firms.