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What Does the Post Crash VC Market Look Like?

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Re: What Does the Post Crash VC Market Look Like?

#91

Post by nickpinkston »

hef19898 wrote: post #61
devoutsalsa wrote: post #39

Earlier quoted context omitted.

I love that movie. It’s my favorite financial drama. I have sympathy & contempt for nearly everyone in that movie.

Honestly, those traders kept around until the dirty work was done got the best deal. Million dollar bonus for a couple of days of work and a clear way out, I would have taken that deal in a second. Side note: Regardless of the borderline sociopathic ruthlessbes of Jeremy Irons character, I'd propably work for him as well. At least for a while. Heck, he was flown to a crisis meeting, listened to the people on the grou…

Agree 100%!

Having been CEO through similar crisis situations, I really related to his character and situation in that movie.

People who criticize his actions don't understand that hard decisions are always between two shitty options. There wasn't a warm-n--fuzzy way to get out of there.

You can criticize their risk management strategy, and honestly we should more criticize the USG / SEC for allowing such risk to build up.

Re: What Does the Post Crash VC Market Look Like?

#92

Post by harambae »

suoduandao2 wrote: post #82
newaccount2021 wrote: post #7

It doesn't look like YC (CRUD apps, IT-related, SV-related) It looks like battery tech, energy tech, commercial space, housing 2.0, water tech SV is done, but had an awesome run

What sort of water tech do you predict we'll see, cheaper desalination? I thought sanitation was a pretty mature technology.

Not GP, but atmospheric water generators that are cheaper and more efficient.

Re: What Does the Post Crash VC Market Look Like?

#93

Post by collegeburner »

suoduandao2 wrote: post #80
collegeburner wrote: post #44

Earlier quoted context omitted.

i don't think it's that simple. pretty much every asset class posting shitty returns this year, hell even bonds are in a bear market. so institutionals are gonna look at other managers and see a bunch of red and not necessarily stop alt allocations. it's also relevant that you can't just ask for capital back as an LP. it's committed to a fund. you can not commit to another one but the price of much greater returns in…

Surely 'all asset classes' can only drop relative to some exception, where is everyone taking their money? I know we have significant inflation, are people going into cash despite it?

Well no. Valuations are based at least in part off discounted future cashflows at a very basic level. If projected cashflows drop enough due to bad economic conditions the value of everything will drop. If you think at a basic level there is less capital to return to shareholders via buybacks or dividends.

Also the fed finally stopped propping up valuations with QE, money is leaving the economy (about damn time).

FWIW VC/PE/some other private stuff isn't actually down yet at least not on paper. But this is bc they are not marked to market very often at all. The reason activity is still good is bc valuations are way down, like half in a lot of cases.

Re: What Does the Post Crash VC Market Look Like?

#94

Post by enos_feedler »

suoduandao2 wrote: post #81
enos_feedler wrote: post #58

Earlier quoted context omitted.

Nobody will want to even mention metaverse if there is a crash

Well I'll go on record predicting the opposite. Meta is an advertising behemoth and has taken a very big bet on metaverse, they can ensure unlimited good press for their baby, especially if their real customers aren't buying as many ads as before. I can see it now: "Life sucks because of the crash? Move to the Metaverse!"

You are a terrible predictor of futures

Re: What Does the Post Crash VC Market Look Like?

#95

Post by suoduandao2 »

collegeburner wrote: post #93
suoduandao2 wrote: post #80

Earlier quoted context omitted.

Surely 'all asset classes' can only drop relative to some exception, where is everyone taking their money? I know we have significant inflation, are people going into cash despite it?

Well no. Valuations are based at least in part off discounted future cashflows at a very basic level. If projected cashflows drop enough due to bad economic conditions the value of everything will drop. If you think at a basic level there is less capital to return to shareholders via buybacks or dividends. Also the fed finally stopped propping up valuations with QE, money is leaving the economy (about damn time). FWI…

I guess I'm asking "the value of everything will drop as measured by what"?

Re: What Does the Post Crash VC Market Look Like?

#96

Post by collegeburner »

suoduandao2 wrote: post #95
collegeburner wrote: post #93

Earlier quoted context omitted.

Well no. Valuations are based at least in part off discounted future cashflows at a very basic level. If projected cashflows drop enough due to bad economic conditions the value of everything will drop. If you think at a basic level there is less capital to return to shareholders via buybacks or dividends. Also the fed finally stopped propping up valuations with QE, money is leaving the economy (about damn time). FWI…

I guess I'm asking "the value of everything will drop as measured by what"?

$ and purchasing power, the economy as a whole has been contracting. like if everything is bringing in fewer $ then everything is worth less.

Re: What Does the Post Crash VC Market Look Like?

#97

Post by anm89 »

kasey_junk wrote: post #71
anm89 wrote: post #48

Earlier quoted context omitted.

This is the least clever take that gets repeated to death by people who are 100% sure they are being very clever. I guess all of those billionaire investors are total idiots thinking about the future without crystal balls. Yes, please give me your misunderstanding of EMH to prove to me I'm wrong. I'll wait.

Do you have a particular billionaire investor in mind? Because the most obvious ones (Buffett, Icahn, Soros, Griffin) explicitly use investment strategies that don’t require knowing where the broader markets are going to go. Ray Dalio got famous and rich specifically designing investment strategies because he didn’t believe in a crystal ball. I’m genuinely curious which investors you are talking about where choosing…

sure, google "Macro hedge fund"

Re: What Does the Post Crash VC Market Look Like?

#98

Post by kasey_junk »

anm89 wrote: post #97
kasey_junk wrote: post #71

Earlier quoted context omitted.

Do you have a particular billionaire investor in mind? Because the most obvious ones (Buffett, Icahn, Soros, Griffin) explicitly use investment strategies that don’t require knowing where the broader markets are going to go. Ray Dalio got famous and rich specifically designing investment strategies because he didn’t believe in a crystal ball. I’m genuinely curious which investors you are talking about where choosing…

sure, google "Macro hedge fund"

I’ve worked for a macro hedge fund so I know the space.

None of the strategies I saw at my time there had anything to do with accurately predicting specific market levels. Quite the opposite they were largely off market positions for the main component with the occasional hedge on the market.

Re: What Does the Post Crash VC Market Look Like?

#99

Post by anm89 »

kasey_junk wrote: post #98
anm89 wrote: post #97

Earlier quoted context omitted.

sure, google "Macro hedge fund"

I’ve worked for a macro hedge fund so I know the space. None of the strategies I saw at my time there had anything to do with accurately predicting specific market levels. Quite the opposite they were largely off market positions for the main component with the occasional hedge on the market.

I never implied that you have to be able to predict and/or time specific market levels either. I'd argue that's moving the goal post from "what's the point of expressing an opinion without a crystal ball" which seems to be the sentiment of your parent post.

It's some variation on

1) "there's no alpha over time, only someone with a crystal ball can make money on any directional play besides line go up" to which I'd say

  a) While most people can't generate alpha over time a, the idea that no one can is empirically wrong.

  b)if you worked at some bizarro world macro hedge fund where no one has any interest in making educated guesses about market direction and is running some kind of medallion / bridgewater strict beta/correlation strategy (how is that macro? doing that in FX, EM equity or international debt? I wouldn't call a medallion type strategy on EM stocks a global macro strategy ) (also bridgewater clearly incorporates directional opinions based on nuanced understanding of history, geopolitics, cycle timing on top of their core strategies, so I'd say you're wrong in the case of Dalio)
2) misunderstanding or misapplying EMH (which I'm not saying you are but I hear it constantly on here) The market is alway's right, there's no point in having an opinion EMH says you can't be the market. Well scratch below the surface and that's not the conclusion you reach

Anyway, that's all to say, I find the "you have no right/validity to talk about where you think markets are heading without a crystal ball" (ie no one should waste time discussing it ever) is not only condescending but as I said, just not correct or clever.

I will finally say that of course there are huge numbers of people having very unintelligent conversations where they throw shit at the wall in terms of market predictions, but you can't judge any activity on people doing it badly, even if that's a large percentage of people in this case

Re: What Does the Post Crash VC Market Look Like?

#100

Post by kasey_junk »

anm89 wrote: post #99
kasey_junk wrote: post #98

Earlier quoted context omitted.

I’ve worked for a macro hedge fund so I know the space. None of the strategies I saw at my time there had anything to do with accurately predicting specific market levels. Quite the opposite they were largely off market positions for the main component with the occasional hedge on the market.

I never implied that you have to be able to predict and/or time specific market levels either. I'd argue that's moving the goal post from "what's the point of expressing an opinion without a crystal ball" which seems to be the sentiment of your parent post. It's some variation on 1) "there's no alpha over time, only someone with a crystal ball can make money on any directional play besides line go up" to which I'd sa…

“If you think what we've seen is the crash you have no idea what's coming”

Is fairly specifically indicating a dramatic change in market level. More specifically it’s calling out that the person expressing an opposite opinion is definitively wrong about the magnitude of a future market move.

I think it’s fair to ask at that point how the person can be so definitive “without a crystal ball”.

Macro hedge funds wouldn’t invest that way (at least not in my experience). They’d risk weight their positions based on a variety of outcomes, even if all of them are directionally the same, and then hedge their downside risk if they are directionally wrong.

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