Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

pubsonline.informs.org

Post reply on HN
Print view View original

31–40 of 102 posts

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#31

Post by satvikpendem »

throwaway89864 wrote: post #27
aliasxneo wrote: post #19

“Our theoretical framework captures how entrepreneurs facing minor, wide, and extreme expectation-reality gaps engage in evermore sophisticated efforts to detach the venture’s externally projected appearance from its actual operational reality.” Look, I’m not promoting fraud at all, but having been doing seed raising for the last eight months, there have been many times where I thought the only way to compete was by…

Was it fudging expected numbers (forecast), or fudging actual numbers (revenue, etc)? VCs are looking for a long-tail, if you have a 1% chance at 5B - 1T market, this is more interesting and impactful than 10% chance at 5M market. And yes, 1% chance of success is considered to be unrealistic by common sense standards.

Ergodicity. For you as an individual startup it is low but a VC looks at a portfolio and at a given size it is almost guaranteed to win.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#32

Post by doodlebugging »

"Facading" is a term that just uses more letters to call someone a liar or thief.

There's no need to beat around any bushes.

When your business culture rewards lying or theft then you have a real ethical problem that signals the need for strong regulatory reform and severe criminal penalties. These sanctions should be retroactively applied for all those who assumed they would be able to dance away scot-free. Asset confiscation, prison time, large financial fines should be distributed to all those liars and thieves, especially the ones who constructed the systems that used algorithmic adjustments to help destroy society or create surveillance operations that could be used against ordinary citizens in violation of privacy.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#33

Post by hansvm »

umpalumpaaa wrote: post #15
Zigurd wrote: post #8

Earlier quoted context omitted.

In the current environment I doubt Elizabeth Holmes would go to prison. She would be saying the machine would work by early next year. After all a drop of blood is just a smaller quantity. Making the machine work is just an engineering problem. If she were really clever she would recruit a social media army of all the weird conspiracy theorists who think "medbeds" are real. Of course now we know that a drop of capill…

The big difference was that she was in the medical field. She used her machines that worked unreliability on patients and caused actual damage to humans. Then she noticed that this could be a problem and switched to blood analyzer from Siemens. But she still continued to say that the machines do work. She lied to investors. I still feel her case is a lot different to what musk is doing. I think you can definitely say…

But what if you say that FSD is actually here and that the only reason you can't fully use it is regulations and then need an extra decade (at least -- still pending)? As one of many examples....

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#34

Post by hansvm »

firasd wrote: post #11
hn_throwaway_99 wrote: post #4

Earlier quoted context omitted.

> Like if someone says we have this many users as a statement you have no idea what they are actually calculating I think that's BS. User metrics are usually very explicitly defined (e.g. monthly or daily active users have always been clearly defined wherever I've worked, even if just for the sole reason that people collecting those numbers need to know what to count). User quality is definitely a gray area and estim…

Right I'm not saying that Zuck's staff doesn't know how to calculate MAU or ARR. I'm saying I'm not sure we can trust the 'median' (median on a scale of super-scrupulous to outright-dishonest) CEO is not counting things like inactive cohorts, newsletter subscribers, website hits when counting 'users'... or being very optimistic about whether a customer will renew when calculating 'recurring revenue' I may be wrong! B…

I'm 100% convinced that accidental website hits and bounces from unique IPs when viewing the ensuant shitty content counts as MAUs for most, if not all, major tech companies.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#36

Post by ryandrake »

sjsdaiuasgdia wrote: post #25
aliasxneo wrote: post #23

Earlier quoted context omitted.

I’m really not trying to virtue signal. There’s a lot more nuance to my reasoning to leave the traditional VC game. All of them led me to declaring it fundamentally incompatible with my world view. Which then led me to my current path of attempting to form a syndicate of like-minded individuals. But this study validates a lot of feelings I’ve had over the last several months. There’s a ton of people that never get ca…

Oh, I did not take it as virtue signaling at all! I do actually admire you for looking at a dirty game and saying "I will not play this, I will find a better way." If I ever win the lottery, I'm going to create the Joseph Welch Foundation. The foundation will give monetary awards to people who have demonstrably pushed back against corruption, lies, and bullshit. For those who don't recognize the name, Joseph Welch is…

What we should be doing, as a civilized society with rules and a regulatory apparatus that's woefully underused, is looking at the dirty game and saying "The game is over. The people/government is going to finally crack down on fraud and people who play the game are going to prison."

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#37

Post by ryandrake »

Zigurd wrote: post #8
firasd wrote: post #3

A lot of 'numbers' startups cite are basically fake I think. Like if someone says we have this many users as a statement to TechCrunch you have no idea what they are actually calculating But there is a clear line that gets crossed if you start actually making a database of millions of synthetic users and that's what happened with 'Frank' that sold to JP Morgan and eventually the founder was prosecuted

In the current environment I doubt Elizabeth Holmes would go to prison. She would be saying the machine would work by early next year. After all a drop of blood is just a smaller quantity. Making the machine work is just an engineering problem. If she were really clever she would recruit a social media army of all the weird conspiracy theorists who think "medbeds" are real. Of course now we know that a drop of capill…

Cool thought process, but the real reason Elizabeth Holmes would not go to prison if she pulled that shit today is much, much simpler: She would know to make a nice sized donation to the current administration (or a sweet business deal for one of his family members), and the justice system would simply be completely hands-off her. She'd give 5% equity to Jared Kushner or something, and go on committing fraud with confidence. It's not complex anymore. Pay to play.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#38

Post by mikelgan »

I'm thrilled someone has attempted to quantify the lies, fraud and deception that has been the norm here in Silicon Valley for decades. I've worked at startups, have friends who are entrepreneurs, everyone in my family has worked at startups, and there's no question that lying and deception are normal and expected here.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#39

Post by sjsdaiuasgdia »

ryandrake wrote: post #36
sjsdaiuasgdia wrote: post #25

Earlier quoted context omitted.

Oh, I did not take it as virtue signaling at all! I do actually admire you for looking at a dirty game and saying "I will not play this, I will find a better way." If I ever win the lottery, I'm going to create the Joseph Welch Foundation. The foundation will give monetary awards to people who have demonstrably pushed back against corruption, lies, and bullshit. For those who don't recognize the name, Joseph Welch is…

What we should be doing, as a civilized society with rules and a regulatory apparatus that's woefully underused, is looking at the dirty game and saying "The game is over. The people/government is going to finally crack down on fraud and people who play the game are going to prison."

I absolutely agree. We need strong rule of law, and we need to start holding everyone accountable to the law.

The era of "I'm too rich / popular / influential / 'important' to prosecute" must end.

Re: Analyzing data from Silicon Valley ventures and founders prosecuted for fraud

#40

Post by close04 »

akiselev wrote: post #26
Zigurd wrote: post #16

Earlier quoted context omitted.

Are you a biochemist? Would the Theranos machine have worked with new tests using new reagents? Is the needed blood volume not similar to, for example, payload capacity? Are we discriminating against people who affect an unusual voice?

It wouldn't have worked, period. You can't use capillary blood for the kind of blood tests they were claiming to. It's statistically impossible because the sample isn't big enough and drawing more capillary blood doesn't improve the SNR. Two samples taken at the same time from different spots on the same finger can yield wildly different results. Everyone in diagnostic medicine knows this (they've been dealing with t…

> but tech VCs don't do due diligence anymore

They hope they can cash out before the bubble bursts, whatever that bubble is.

Post reply on HN