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The 99% (of startups)

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Re: The 99% (of startups)

#101

Post by sokoloff »

zaidf wrote: post #93
downandout wrote: post #64

This gives an interesting glimpse into the prognostication abilities of supposedly brilliant VC's. It also shows the the near-impossibility of cashing in private company shares, at least through VC's. In addition to this story, the Sony hack revealed that Evan Spiegel of Snapchat wanted to cash in about $40 million worth of shares just after he spurned Facebook's $3 billion offer. He was also roundly rejected. Had so…

I wonder why Zuckerberg didn't buy the $40M stake personally. I'm guessing he was turned down.

Why would he? He wanted the whole company and was spurned. What incentive would there be to then reward the founder with 2 commas of personal liquidity?

Zuck's not trying to make small side investments personally that might enrich him but would certainly cause questions of conflict of interest with his CEO role at FB.

Re: The 99% (of startups)

#102

Post by tomasien »

downandout wrote: post #64

This gives an interesting glimpse into the prognostication abilities of supposedly brilliant VC's. It also shows the the near-impossibility of cashing in private company shares, at least through VC's. In addition to this story, the Sony hack revealed that Evan Spiegel of Snapchat wanted to cash in about $40 million worth of shares just after he spurned Facebook's $3 billion offer. He was also roundly rejected. Had so…

There are lots of businesses where it's really easy for founders to cash out - profitable businesses! I'm not even trying to be one of those HN commenters that bemoans the cashflow negative startup ecosystem (lots of ways to build a business), there are tons of profitable businesses whose founders cash out large amounts of stock regularly.

The category of VC that wants founder secondary and the category of VC that likes loss leading consumer facing businesses are not well aligned.

Re: The 99% (of startups)

#103

Post by rtpg »

coldtea wrote: post #86
nitrogen wrote: post #73

Earlier quoted context omitted.

Maybe somebody will come up with an esport that incorporates current events that is also entertaining enough for a lot of people to watch.

If people only watch/read stuff because it's "entertaining", that's already a loss to culture and democracy. Especially since entertaining gets all the more Huxley-an and Kardashian standards all the time.

That's implying that it hasn't always been like that. The masses are usually looking for things to enjoy themselves with, it's not like a century ago people were more well-informed about what was happened.

Re: The 99% (of startups)

#104

Post by bduerst »

6stringmerc wrote: post #70
downandout wrote: post #64

This gives an interesting glimpse into the prognostication abilities of supposedly brilliant VC's. It also shows the the near-impossibility of cashing in private company shares, at least through VC's. In addition to this story, the Sony hack revealed that Evan Spiegel of Snapchat wanted to cash in about $40 million worth of shares just after he spurned Facebook's $3 billion offer. He was also roundly rejected. Had so…

The way you phrase this reminds me of what I studied happening in the hedge fund world, in that some of the 'top performer' funds only out-performed the market due to insider trading. Galleon (Raj - convicted), SAC (sanctioned), and probably a handful more that got spooked out of the avenue of enrichment. It almost seems - almost - like there may be a similar insular community whereby those who feel like piling in wi…

There are people who willfully, knowingly invest in ponzi schemes, on the premise that they will try to get out before operator flees with the money because up until that point, it has outstanding returns.

Re: The 99% (of startups)

#105

Post by gregpilling »

Androider wrote: post #80
coffeemug wrote: post #68

Earlier quoted context omitted.

> This gives an interesting glimpse into the prognostication abilities of supposedly brilliant VC's. The question isn't whether VCs are brilliant according to some absolute metric. The question is whether they deploy capital better than random chance. The numbers show that top ten VCs consistently do.

Take 1000 people, have each predict a coin flip 10 times. The top 10 players will have predicted way better than random chance would have you believe. Why several of them are even 10 for 10, they must have special prediction powers! ;) Grow the player base, increase the number of predictions, you'll end up with some real super-stars who just go on winning. They'll probably write books and lecture about their techniqu…

I modeled this one day in Excel, using random numbers. In my case, the game was Russian Roulette and the group played it once a year for 20 years. I was very surprised that no matter how many times I refreshed the random results, a large percentage of 'players' were still playing after 20 rounds.

I read this example in a book or article, but I can't remember what that was called.

Re: The 99% (of startups)

#106

Post by incepted »

srameshc wrote: post #33

Why the hell is this so negative ? He is very clear "This is for all the founders who know they have built something that people want, but the rest of the world hasn’t recognized it yet." It must be tough as a founder to prove yourself and others that there is an certain value to his/her business. Isn't a good exit is what an investor's or founder's option ?

> "This is for all the founders who know they have built something that people want, but the rest of the world hasn’t recognized it yet."

So... 100% of the founders.

Re: The 99% (of startups)

#107

Post by incepted »

ThomPete wrote: post #55
srameshc wrote: post #33

Why the hell is this so negative ? He is very clear "This is for all the founders who know they have built something that people want, but the rest of the world hasn’t recognized it yet." It must be tough as a founder to prove yourself and others that there is an certain value to his/her business. Isn't a good exit is what an investor's or founder's option ?

Or to paraphrase Horowitz. Building a startup is hard. You will have to stand up to a lot of people who will tell you everything you are doing wrong. If you care a lot about social signals you probably shouldn't be an entrepreneur.

Then again, 99% of the people telling you what you're building will never work are right.

Re: The 99% (of startups)

#108

Post by coldtea »

rtpg wrote: post #103
coldtea wrote: post #86

Earlier quoted context omitted.

If people only watch/read stuff because it's "entertaining", that's already a loss to culture and democracy. Especially since entertaining gets all the more Huxley-an and Kardashian standards all the time.

That's implying that it hasn't always been like that. The masses are usually looking for things to enjoy themselves with, it's not like a century ago people were more well-informed about what was happened.

>That's implying that it hasn't always been like that.

I don't ascribe to the "culture is always the same constant thing quality-wise, nothing ever changes but fashions" viewpoint.

From all I've read from others and experienced personally, I see that even if that well-informed culture in the past only concerned/involved like 5% of the people, the equivalent 5% is worse off today.

At least in my country, along with the usual entertainment stuff, 20 or 30 years ago we had several excellent newspapers with big circulations. Editorial standards now are at an all time low -- and even worse for the internet outlets that replaced them.

Same with TV -- the quality of TV product has shrank considerably, from high brow movies and talk shows to the equivalent of Oprah or reality TV.

TV news for example, started with a couple of presenters giving an overview of current events in a somber tone and well written copy, and it has since the late nineties turned into the equivalent of a Geraldo show, with "dramatic" music, overdone titles, and the hosts having guests in PIP windows arguing at each other.

Re: The 99% (of startups)

#109

Post by [deleted] »

bduerst wrote: post #104
6stringmerc wrote: post #70

Earlier quoted context omitted.

The way you phrase this reminds me of what I studied happening in the hedge fund world, in that some of the 'top performer' funds only out-performed the market due to insider trading. Galleon (Raj - convicted), SAC (sanctioned), and probably a handful more that got spooked out of the avenue of enrichment. It almost seems - almost - like there may be a similar insular community whereby those who feel like piling in wi…

There are people who willfully, knowingly invest in ponzi schemes, on the premise that they will try to get out before operator flees with the money because up until that point, it has outstanding returns.

[deleted]

Re: The 99% (of startups)

#110

Post by oskrim »

coffeemug wrote: post #75
fweespeech wrote: post #74

Earlier quoted context omitted.

> The question isn't whether VCs are brilliant according to some absolute metric. The question is whether they deploy capital better than random chance. The numbers show that top ten VCs consistently do. Does it? If you have enough gamblers in a high stake casino where the house hasn't stacked the deck, some of them will seem to consistently win in comparison to the other players. Similarly, a very small percentage o…

This analysis breaks down if the top ten outperform the market after you've started watching them. If that's the case (which for top ten VCs it is), the math suggests it isn't a "million quarters" situation.

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