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Winter is coming

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Re: Winter is coming

#61

Post by SkyMarshal »

timmyd wrote: post #18

Its funny that in 2008 - we see posts like "RIP Good Times" - http://techcrunch.com/2009/10/06/r-i-p-good-times-one-year-l... - and yet nothing - fundamentally - came of it. I'm sure Sequoia's companies left that meeting - scared, sacked a bunch of employee's, cleaned out the closest - and the VC's were happy because the capital lasted longer ensuring no more dilutions for themselves and a "trimmer" business even if…

Nothing terrible happened after 2008 because the Fed and US Govt completely propped up the US economy with $700B TARP + $800B stimulus + two rounds of Quantitative Easing + many more billions of alphabet soup supports and bailouts.

The result was deficit spending making up for a precipitous dropoff in GDP:

http://imgur.com/1aJbj

The idea was to prevent a shock and/or collapse and buy time to work out the underlying problems, and they succeeded at the former but may have run out of time on the latter.

But much of that ammo is now used up. It's doubtful the GOP in Congress would allow another massive stimulus, leaving only the Fed's ability to keep rates low and possibly try another QE3.

So, my point is, don't take for granted that nothing much happened after 2008. It only played out that way because of massive intervention, but much of the underlying problems still haven't been solved, and a shock or collapse are unfortunately still possible.

Re: Winter is coming

#62

Post by pclark »

rdl wrote: post #56
geoka9 wrote: post #50

Earlier quoted context omitted.

> A company like Y Combinator can literally fund hundreds of startups and as long as at least one has a significant payday at the end Y Combinator still comes out on top. I understand that Y Combinator only does token investment in terms of money, and gets a good share of the startup in exchange for its brand and the experience and connections of its founders within the VC world. Since the actual money outlay is low,…

I used to think I would want to be an angel investor at some point, but being an LP at YC (and maybe at a later stage VC, and get shares in great long term companies directly or via BRK.A, would really meet my goals.

I think it is really hard to become a limited partner in good VCs, unless you are godlike in some domain (which I guess you especially would be when you eventually exit) or were a founder of one of their successful companies.

Re: Winter is coming

#63

Post by grandalf »

cek wrote: post #59
grandalf wrote: post #35

Check out my counter-argument: Why are startups hot now? Not because the economy is good or because the startup ideas people are having are particularly good, but because risk seeking investors are trying to shove capital anywhere they can. After the crash of 2008 lots of avenues (created by Wall Street post Financial Modernization Act) to invest this capital were closed, and the growth of the startup scene, particul…

I concur with your counter-argument. I'll add that one of the reasons we've seen such a huge increase in startup activity and entrepreneurship in the last 4-5 years is the fact that getting a startup from an idea to an Internet scale web service costs practically nothing now. 4-5 years ago a startup (like iLike) had to spend millions up front on server and infrastructure costs. Then the ongoing opex costs for serving…

This is right on. Ultimately it empowers everybody, since by the time funding is needed there is a far greater chance that there's traction.

Re: Winter is coming

#65

Post by smountcastle »

I enjoy reading Eric Ries' posts but I cannot help but be cynical about this, "Remember: in the long run, the surest way to be successful is to create more value than you capture. Remember: the truly great entrepreneurs didn't get in this to make money, but to change the world." I guess his company IMVU created value (in terms of money) but I don't see how an online social entertainment destination where members use 3D avatars to meet new people, chat, create and play games with their friends creates social value or changes the world.

Re: Winter is coming

#66

Post by michaelochurch »

It was March, then I took a nap, and now it's November.

This is what you get when Republicans are in charge (and they still are; look at Congress): short, puny expansions and punishing, horrible recessions.

Re: Winter is coming

#67

Post by rdl »

pclark wrote: post #62
rdl wrote: post #56

Earlier quoted context omitted.

I used to think I would want to be an angel investor at some point, but being an LP at YC (and maybe at a later stage VC, and get shares in great long term companies directly or via BRK.A, would really meet my goals.

I think it is really hard to become a limited partner in good VCs, unless you are godlike in some domain (which I guess you especially would be when you eventually exit) or were a founder of one of their successful companies.

Yeah; this is assuming a large, successful exit, then reinvesting some of your exit into your investors as an LP. Otherwise you'd be a crappy angel investor anyway.

Re: Winter is coming

#68

Post by nashequilibrium »

edw519 wrote: post #4

From "The Godfather", about the cycles in their "industry": MICHAEL How bad do you think it's gonna be? CLEMENZA Pretty goddamn bad. Probably all the other Families will line up against us. That's alright -- this thing's gotta happen every five years or so -- ten years -- helps to get rid of the bad blood. Been ten years since the last one.

When has entrepreneurship ever been easy? sighhh!!

Re: Winter is coming

#69

Post by diogenescynic »

chailatte wrote: post #40
hnsmurf wrote: post #39

I'm not so sure. I think the broader economic forces may help tech companies rather than hurt. No matter what happens, America (and the world) will still have a lot of very wealthy people and institutions. Those people need to put their money somewhere. The stock market is scary, bonds and banks don't pay anything. If you had $100 million tomorrow to invest what would you do with it? I'd start looking for startups. 1…

I would invest in gold. No hassle. No risk since every country is printing money and putting savers at risk. Doubled in price in dollar in two years thus far.

Every piece of gold every minted is still sitting around somewhere, there is no reason tomorrow it won't be back down to $400/oz. Gold is just a measurement of fear and confidence in governments/currencies. If you really think governments/FIAT currencies are going to fail you might as well by SPAM and canned goods because they're going to be a hell of a lot more valuable during a true depression than some shiny metal.

Re: Winter is coming

#70

Post by trevelyan »

vynch wrote: post #45
trevelyan wrote: post #23

Winter is icummen in, Lhude sing Goddamm. VCs stop and angels drop, Like aggregate demand.... Sing: Goddamm. Downcast brow and skittish DOW Show profit on the lam Suster shivers, Techcrunch quivers Damn you, sing: Goddamm. Goddamm, Goddamm, (and Groupon's canned), Goddamm, Watch Pincus do facepalm. Sing goddamm, damm, sing Goddamm. Sing goddamm, sing goddamm, DAMM.

lol downvoting this must feel really good!

I was pretty pleased about working "the winter's balm" line into that bit about Zygna. And there were a couple of upvotes early on, but I guess meta jokes about English literature don't fly on a hacker audience.
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