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Who Are My Investors?

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Re: Who Are My Investors?

#131

Post by tway9876x22 »

swsieber wrote: post #76
TAForObvReasons wrote: post #74

Earlier quoted context omitted.

> I don’t claim to have entirely clean hands in this regard. When we sold our Twitter stock before the IPO many years ago, it turned out the buyer was fronting for gulf interests. I found that out after the fact but that doesn’t absolve me of anything. I could have asked the questions before executing the sale. ^^ That's why. He's "raising the bar" after making money through means that he would find despicable now. "…

People do change. Calling it posturing is premature judgement.

Yes, people change. My concern about people suddenly changing their stance on Saudi Arabia is why now and why only Saudi Arabia. Two major points:

Saudi Arabia is a brutal regime. That didn't start Khashoggi. If we had any doubt, the 50,000 civilian deaths in Yemen should have cemented the brutality of Saudi Arabia. I'm more concerned about people who suddenly decided to consider their moral position after a single US permanent resident (Khashoggi) died, and conveniently ignored the years of brutality leveled upon Saudi Arabia's neighboring civilians.

I'd also challenge whether tsese individuals are also distancing themselves from Lockheed Martin -- the weapons manufacturer selling weapons of Saudi Arabia. Recently a Lockheed Martin bomb was used to kill a bus-full of Yemeni school children...I suppose that is still OK?

Re: Who Are My Investors?

#132

Post by BeetleB »

ssijak wrote: post #90
ed_balls wrote: post #77

Earlier quoted context omitted.

As other commenter pointed out, we don't have enough information to judge the situation beyond reasonable doubt. MBS was selling himself as a reformer and everybody deserves a benefit of a doubt. Maybe it was of one the generals that decided to kill the journalist. Why would MBS risk all the deals he has made and about to made? Oil doesn't give him that much leverage right now and sanctions could topple the governmen…

Yes you can know. It is not like this was the first bad thing Saudis have done under his command.. Not to mention the usual evils of such oil nations like spending bilions on personal yachts, art, mansions, etc..., having slave-like labor in your country, kidnapping, behedings for many non-crime (in civilised world) things, etc. "reformer" thing is a joke and a mask.

>Yes you can know. It is not like this was the first bad thing Saudis have done under his command.

Depends on how bad you're talking about.

Saudis are not known as people who kill in other countries. They actually have a robust reputation of kidnapping them and bringing them to KSA (and even of the known kidnapped ones, I think all are still alive). Even within the country, they're known more for making people disappear - temporarily. As in family has no idea where the person is - but usually find out about a year later - and the person is usually in prison - not dead.

Saudi Arabia is known for executing dissenters - but not in a shadowy manner. They arrest, they bring serious charges, and then execute publicly. When they do this often enough, there is not much rationale for them to assassinate people in their own country in a hidden way.

I feel that just because we know of many brutish things the Saudis have done in the past, we are extrapolating to things they likely do not do often. The opposite of the halo effect, if you will. I've seen this often, where people conflate the different Middle Eastern countries and attribute the problems in one country to those in the other - without evidence (e.g. believing honor killings are common in Saudi Arabia).

I don't believe this scenario is at all the norm amongst the Saudi government. I could be wrong, and would be happy to be shown otherwise.

Re: Who Are My Investors?

#133

Post by BeetleB »

cowpig wrote: post #51
tomkit wrote: post #47

Honorable, but it could also be a slippery slope: how far back do you look? If an LP, or investor in general, uses their personally earned money, but they earned it through capital gains from tainted money - let’s say from stock in a company with human rights issues - do you ask about that and if so do you take their investment? If you only look at one degree, ie are your direct investors’ money clean, you could also…

Slippery Slopes are a slippery slope. If you reason about everything in extremes, how can any solution ever be acceptable? The worst case for all real-world solutions are always bad.

He did not say "Let's reject all this because it is a slippery slope." He is merely alerting people that the slope is slippery.

Re: Who Are My Investors?

#134

Post by retsibsi »

refurb wrote: post #75

I hate it when, just because something becomes a big media story (I.e. Saudi Arabia killing a journalist) everyone comes out of the woodwork “oh dear! How can we not do business with these people?” When in fact, it’s been going on for decades and nobody gave a shit... until now, when giving a shit can firm up your virtue signaling.

Does it really matter, though? Sure, some people might earn some undeserved virtue points -- but why focus on that, when the alternative is for everyone to continue not giving a shit, and nothing to change.

Humans are often inconsistent, irrational, hypocritical, disproportionately sensitive to emotional immediacy vs. scale, and so on. We already know that.

Every successful, large-scale ethical movement is going to have a moment when a bunch of people jump on board the bandwagon for imperfect reasons. That might be annoying, but it's part of the mechanism by which change actually happens.

Re: Who Are My Investors?

#135

Post by protomyth »

“Bad actors” doesn’t simply mean money from rulers in the gulf who turn out to be cold blooded killers.

If your knowledge of the House of Saud's crimes start with the death of one reporter, then you really need to do some research. Just look at what constitutes a capital crime in Saudi Arabia. Look at your colleagues and ask how many of them would be jailed or executed?

If you were fine taking money from them a year ago, then I really question what makes one more soul lost special for you? Realpolitik means nothing of substance will be done because we have other enemies and $400/barrel oil would not go over well just as I'm sure this incident too will fade before the next storm.

Re: Who Are My Investors?

#136

Post by TAForObvReasons »

whatusername wrote: post #127
TAForObvReasons wrote: post #99

Earlier quoted context omitted.

> It is time for all of us in the startup and VC sector to do a deep dive on our investor base and ask the question that the CEO asked me. Who are our investors and can we be proud of them? And do we want to work for them? I would extend that question even further: Can we be proud of the gains we've made by working with the investors we've dealt with in the past? If not, how are we addressing the problem? You can't b…

Except there’s a very large gap between: * corrupt entity A gave me $X And: * corrupt entity B bought Y from me at price $Z at essentially market value. The amount to return in the first case is obvious. The second is much less clear (since the cash was essentially fungible)

The market value is skewed by the fact that the money is tainted. To put it differently: if real estate wasn't as effective a vehicle for money laundering, prices in places like Vancouver wouldn't have skyrocketed. So while technically people paid "market value", the number is meaningless

Re: Who Are My Investors?

#137

Post by AnthonyMouse »

akiselev wrote: post #117
AnthonyMouse wrote: post #105

Earlier quoted context omitted.

> Pretty much every single comment so far is cynical. "No one really wants to know how the sausage is made", lots of money is tainted anyway, it's just PR fluff, etc etc. It seems like a deeper problem than that, which is that money is fungible. It's the same thing as saying we shouldn't buy Saudi oil. If the only result is that you buy some other oil and the people who would have bought that oil buy the Saudi oil, n…

Saudi Arabia is a counter example to your point: Iran has a considerable amount of oil but because of unrelated geopolitical circumstances, it can't easily sell that to the global market like KSA can. That imbalance has little to do the nature of oil and a lot to do with the KSA-United States' petrodollar and arms deals. The geopolitics of the world put KSA in a position to capitalize on its oil wealth and trade it f…

> Saudi Arabia is a counter example to your point: Iran has a considerable amount of oil but because of unrelated geopolitical circumstances, it can't easily sell that to the global market like KSA can. That imbalance has little to do the nature of oil and a lot to do with the KSA-United States' petrodollar and arms deals.

It has little to do with oil and much to do with Trump making the Iran deal a campaign issue and therefore doing everything he can to pressure them into renegotiating. The outlier is Iran rather than Saudi Arabia. Russia and Venezuela aren't having any trouble selling their oil either. Moreover, as Iran's production is down, oil prices are up. This, ironically, actually hurts the Saudis too, because it makes oil less competitive against alternatives in the short term, encouraging faster adoption of alternatives that suppress oil prices in the long term.

And Iran's production is only down because of US-led international sanctions, which clearly falls into the category of market power. But they're also the reason the US can't go after the Saudis at the same time, because until we transition away from oil (which takes time), the US economy is still highly sensitive to oil prices, which are already higher due to Iran. The Saudis are actually doing Trump (not to say themselves) a favor by increasing production during the sanctions on Iran.

Re: Who Are My Investors?

#138

Post by notafraudster »

AnthonyMouse wrote: post #105
dcposch wrote: post #38

Pretty much every single comment so far is cynical. "No one really wants to know how the sausage is made", lots of money is tainted anyway, it's just PR fluff, etc etc. The classic HN Middlebrow Dismissal in full effect. Counterpoint: cynicism is too easy. Actually giving a shit is harder, it's uncomfortable, it involves compromise. Yes, if you refuse investment from any country that has ever violated a human right,…

> Pretty much every single comment so far is cynical. "No one really wants to know how the sausage is made", lots of money is tainted anyway, it's just PR fluff, etc etc. It seems like a deeper problem than that, which is that money is fungible. It's the same thing as saying we shouldn't buy Saudi oil. If the only result is that you buy some other oil and the people who would have bought that oil buy the Saudi oil, n…

Fungibility matters if your only goal is to make it impossible for bad dudes to sell their product / invest. But keeping your own hands clean is an admirable goal in and of itself, and certainly concluding "this doesn't make a difference in the grand scheme so why should I care" seems to be the exact kind of cynicism the parent comment was critiquing

Re: Who Are My Investors?

#139

Post by AnthonyMouse »

notafraudster wrote: post #138
AnthonyMouse wrote: post #105

Earlier quoted context omitted.

> Pretty much every single comment so far is cynical. "No one really wants to know how the sausage is made", lots of money is tainted anyway, it's just PR fluff, etc etc. It seems like a deeper problem than that, which is that money is fungible. It's the same thing as saying we shouldn't buy Saudi oil. If the only result is that you buy some other oil and the people who would have bought that oil buy the Saudi oil, n…

Fungibility matters if your only goal is to make it impossible for bad dudes to sell their product / invest. But keeping your own hands clean is an admirable goal in and of itself, and certainly concluding "this doesn't make a difference in the grand scheme so why should I care" seems to be the exact kind of cynicism the parent comment was critiquing

The point is that some things make a proportional difference, which at the level of an individual is minimal but make a real impact if 30-70% of people do it, whereas other things only work with a critical mass, which are then still useless even if 30-70% of people do them because you need 70-100% of people to do it for it to be effective at all.

If you as an individual are going to do something, do the first kind of thing.

Re: Who Are My Investors?

#140

Post by zt »

jamiequint wrote: post #113
zt wrote: post #81

Earlier quoted context omitted.

Except, Fred made the decision about his LPs over the last 15 years...

There's nothing in the article to suggest that this is due to virtue though. It may be just that USV has the luxury of raising from only top tier LPs given their relatively small fund size ($1bn across 6 funds).

You’re right. It is true that top quality LPs tend to be universities, foundations, and pension funds. And with a funds USV’s size it’s pretty easy to only fill it with those good guys. I was surprised they had any family offices.

Before the global growth fund, Sequoia claimed that all of their LPs were not-for-profits (although excluding pensions funds is usually for transparency reasons).

Having said that, I don’t think that every top quartile fund could make the same claim even if USV, Sequioa, and Benchmark could...

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