51–60 of 110 posts
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This is literally the policy aim of the Fed right now. Unemployment is at historical lows with inflation running rampant. The ostensible aim of interest rate hikes is slowing inflation, but the byproduct is a cooling in the broader markets and economy, which in turn, affects the labor market.
Yeah the idea is to burn labors and wages to the ground and finish off get middle class.
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Nobody wants to say the quiet part out loud but... It's bad politics in the United States to have a strong labor market for too long: you have lots of anxiety among small and large businesses and you have inflation pressure. So they're going to manufacture unemployment to cool everything down.
Another more optimistic way of looking at it is the idea that as we transition into a higher interest rate environment, there will be short term pain as unprofitable businesses downsize / go under, their workers are let go, but they eventually make their way into healthy/sound companies that now have the scope to grow and contribute to real macroeconomic growth rather than just the nominal smoke and mirrors of the re…
Rather than just being a place for successful early ventures to cash out?
Does this provide more opportunity (and risk) for the equities market in the earlier phases of a promising business? Rather than just being a place for successful early ventures to cash out?
As a bystander not viewing this through SV lens, I do somewhat hope that the VC bubble bursts (although I 100% feel bad for low level employees that will suffer). Looking at the market during 20-21 it seemed like it was acting in ways that, at least to me, feel like market manipulation/fraud/pyramid scheme (see SPACs). Companies that barely even had a product were "valued" at billions - it just doesn't make sense. Al…
When / if the bubble bursts, it will be as bad or worse than the dotcom and subprime bubbles. Tech and vc is not an insulated think like maybe it once was, it's the current equivalent of the 80s junk bonds, it's a ponzi scheme that could unravel hard. That will be really bad for a lot of people. I added the "if" because I'm not convinced it will play out that way because we're in some weird post-capitalist mode now w…
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I mean the comparison to car salespeople is a bit harsh but yeah anyone who is dealmaking plays some kind of games to varying degrees. There is a broader narrative that they are trying to point to that is LP money isn't showing up in the same way now that there are other opportunities to generate returns in the macro market. Combine that with geopolitical risks and public tech companies valuations getting crushed - t…
You're right -- it's a bit harsh. I've been on both sides of the investment committee meetings. As a result of that, I've seen (and delivered) this messaging before. Matt's an excellent investor and someone I respect and trust. So are the other investors putting up orange flags for their portfolio. It's smart to be prepared early. But it always seems like investors get giddy with excitement about saying the "sky is f…
The cash-rich funds are coming in as there aren't good looking exits at this point due to the inflated valuations / overall market conditions. Might be helpful for founders for sure. Curious how this will impact the broader community and how that will play out on their actual fund returns. Definitely puts the squeeze on smaller seed / angel investors
Having been at a series C+ company that ran out of money. There are a few things to keep in mind if you are working at a non-profitable startup. 1) Investors need to invest in something , not continuing operations. Companies who are about to run out of money will often claim to pivot in a different direction, launch new products, or go on hiring binges. A good sign that something is amiss is when all of this isn't ba…
If the company is doing well, this can be the best time, because your stock will immediately appreciate significantly.