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

Unicorns are setting up their own venture capital funds

bloomberg.com

Post reply on HN
Print view View original

51–60 of 86 posts

Re: Unicorns are setting up their own venture capital funds

#51

Post by beagle3 »

sonnyblarney wrote: post #28
AndrewKemendo wrote: post #10

Earlier quoted context omitted.

This theory basically assumes that firms cannot get smarter over time. It assumes corporations will never get better at evaluating the market and their place in it, or have better information than previous generations. That's a dangerous assumption, and doesn't seem to jibe with what we see in practice.

"That's a dangerous assumption, and doesn't seem to jibe with what we see in practice." I see exactly this in practice. Big companies are usually totally lacking in self awareness on so many things. 'Good companies' have a strong sense of where they are, and can manage direct threats - I think FB is a good example. But more distant threats, I don't think so. And most companies are not 'good companies'. Nortel, Nokia,…

There's a piece in Andy Grove's book ("Only the paranoids survive") where tells about realizing that sales of memory are slowly going down - it's still comfortable for everyone, but at this right he will be fired by the board in a couple of years. So, he thinks "my replacement will get a carte blanche; what will they do?" and realizes that it would be "concentrate on microprocessors", a small but slowly growing Intel business -- a completely heretic, "hail mary" at a point that still doesn't seem so bad. So that's what he does.

On the other hand, Intel sold their ARM business about 20 years ago because it had lower margins than they liked (and in fact, axed a lot of relatively low margin business). But, as they are slowly discovering - someone WILL eat your margins, if it isn't yourself, it is someone else.

Re: Unicorns are setting up their own venture capital funds

#52

Post by JumpCrisscross »

mcny wrote: post #49
JumpCrisscross wrote: post #43

Earlier quoted context omitted.

> They don't need 'a fund' to do that Having dealt with both, there is a difference. Corporate M&A is corporate finance. Their teams come from investment banking backgrounds and are not equipped to evaluate early-stage investments. They therefore don’t get pitched them. Corporate VCs, on the other hand, exist to evaluate young companies and write small checks. The market know that, and therefore shows them early-stag…

Do "corporate VC" people have the mindset of a VC in that they're aware that most investments will fail and that's ok as long as a few "moonshots" go really well? Was Yahoo! buying tumblr an example of corporate VC? How about Facebook buying Instagram?

> Do "corporate VC" people have the mindset of a VC in that they're aware that most investments will fail and that's ok as long as a few "moonshots" go really well?

In my experience, the VCs themselves do. Their bosses say they do (hence why the corporation started a VC arm). But after a few failures, that tends to change. (Analog: why many corporate cultures try and fail at emulating Skunkworks.)

> Was Yahoo! buying tumblr an example of corporate VC? How about Facebook buying Instagram?

No, that’s M&A. Generally when one says Company A bought Company B, that’s corporate finance.

GM investing in Lyft is corporate VC. Tyson investing in Beyond Meat is corporate VC. Minority stakes, early-stage companies and a strategic motive describes corporate VC.

Re: Unicorns are setting up their own venture capital funds

#53

Post by hobofan »

beagle3 wrote: post #5
AndrewKemendo wrote: post #3

From an operations perspective, this is for Business Intelligence and creating a funnel for acquisitions. Venture is one of the best ways to spot trends in your own market(s), and lead run any future competition with an acquisition, new product or product changes. This is one of the major things that distinguishes major 21st century companies today from major companies in the past. If you know all of the up and comin…

Microsoft knew all about Google Yahoo knew everything about Google Google knew everything about Facebook Intel knew everything about ARM Yet disruption ensued. “Can’t be disrupted” is foolish.

Facebook knew everything about Snapchat, and they are currently crushing them.

Microsoft at their core also wasn't disrupted by Google.

Google at their core also wasn't disrupted by Facebook.

They're all tech giants in the same (broad) industry, but they have widely varying products. Competitive BI certainly has its merits if you are trying to stay at the top of your field.

Re: Unicorns are setting up their own venture capital funds

#54

Post by hobofan »

asaph wrote: post #13
etaioinshrdlu wrote: post #6

A lot of blockchain tech startups raise money and then turn around and invest in other startups. I think we're gonna look back at this in 5 years and collectively say, what were we thinking?

Protocol Labs (best known for developing FileCoin & IPFS) launched a $5M crypto grant program.[0] [0] https://www.coindesk.com/blockchain-startup-protocol-labs-an...

I think grants are a whole different thing, especially in the cryptocurrency space. A lot of your value depends on how interoperable with other systems/protocols in the space, and grants can incentivize prioritized work on that interoperability.

Protocol Labs grants are again a different thing since they are essentially traditional academic research grants.

Re: Unicorns are setting up their own venture capital funds

#55

Post by hobofan »

arcanus wrote: post #11
etaioinshrdlu wrote: post #6

A lot of blockchain tech startups raise money and then turn around and invest in other startups. I think we're gonna look back at this in 5 years and collectively say, what were we thinking?

> we're gonna look back at this in 5 years and collectively say, what were we thinking? We did that after the housing bubble in 2008 (low down payments, flexible credit ratings, etc.) The big question is: could this also be a systemic risk to the economy? No one liked bailing out the banks, but it was necessary to save the economy. It is not clear tech or crypto are similarly critical.

I think it's already pretty clear that crypto doesn't need bailouts.

The total cryptocurrency market size is at 1/4th of what it was at the beginning of the year, and there haven't been any significant results because of that. I would wager that the remaining 1/4th could be wiped out and it's still pretty much the same. Crypto projects were always very removed from the real world, both in valuation and usage (so if crypto vanishes it doesn't impact other companies).

The biggest result of the crypto market correcting will probably be software engineer salaries becoming a bit lower again (outside of SF).

Re: Unicorns are setting up their own venture capital funds

#57

Post by goldfeld »

etaioinshrdlu wrote: post #6

A lot of blockchain tech startups raise money and then turn around and invest in other startups. I think we're gonna look back at this in 5 years and collectively say, what were we thinking?

Why, let the US sink itself in inequality if that's what university people want. So much for the liberal arts major navigating society, the dream is gone, the song is over.

Re: Unicorns are setting up their own venture capital funds

#58

Post by [deleted] »

hobofan wrote: post #53
beagle3 wrote: post #5

Earlier quoted context omitted.

Microsoft knew all about Google Yahoo knew everything about Google Google knew everything about Facebook Intel knew everything about ARM Yet disruption ensued. “Can’t be disrupted” is foolish.

Facebook knew everything about Snapchat, and they are currently crushing them. Microsoft at their core also wasn't disrupted by Google. Google at their core also wasn't disrupted by Facebook. They're all tech giants in the same (broad) industry, but they have widely varying products. Competitive BI certainly has its merits if you are trying to stay at the top of your field.

[deleted]

Re: Unicorns are setting up their own venture capital funds

#59

Post by atomical »

pluma wrote: post #50
atomical wrote: post #31

Earlier quoted context omitted.

This sentiment on blockchain is posted very often. Have the authors studied all startups in the top 100 on CoinMarketCap? How about top 500? Yes, we've all met people who read about Bitcoin and Ethereum in the WSJ and felt incredibly smart when both declined from their highs. But what about the ICO money raised in 2018? It's likely over 5 billion at this point.

If you want to make a case for blockchains, maybe you shouldn't lead with the proven pyramid schemes that are ICOs? "They ripped off over 5 billion dollars in cash, that means it's not a bubble." Well, doesn't that actually tell you the opposite? That people threw money at obvious scams just because the scams used fancy technology and a buzzword?

And maybe you shouldn't lead with a generalization. Not all of them were scams.

Re: Unicorns are setting up their own venture capital funds

#60

Post by atomical »

wpietri wrote: post #42
atomical wrote: post #31

Earlier quoted context omitted.

This sentiment on blockchain is posted very often. Have the authors studied all startups in the top 100 on CoinMarketCap? How about top 500? Yes, we've all met people who read about Bitcoin and Ethereum in the WSJ and felt incredibly smart when both declined from their highs. But what about the ICO money raised in 2018? It's likely over 5 billion at this point.

Ah, the "there has to be a pony in there somewhere" [1] theory. Am I going to look at every MLM scheme or perpetual motion machine to explain in detail why this new one is just as bad as the rest? No. I looked at a bunch, formed a general impression and a reasonable theory as to why they're all bunk, and have stopped wasting my time. If somebody has a specific one that they'd like to argue is different I'm willing to…

No, I'm merely saying you are uninformed and ignorant. That's all.

If you aren't an expert don't bother postulating. We aren't here to do the research for you.

Is Brendan Eich a scammer? Nope.

Post reply on HN