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Andreessen Horowitz to give half their earnings to charity

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Re: Andreessen Horowitz to give half their earnings to charity

#71

Post by lotharbot »

jimmyvanhalen wrote: post #55
lotharbot wrote: post #47

Earlier quoted context omitted.

> "they're in the venture capital business, not in the charity business" They're in the business of being human. As is true for any of us, that means something complex, multidimensional, and personal. It's not some sort of affront to venture capitalism to use the profits it generates for something other than more venture capitalism. It's not a "waste of capital" to use your own capital for whatever you find important…

the money they make for their LPs goes to pension funds, universities, businesses, etc. which in turn creates more jobs, start-ups, investments, donations to charities, etc. If you're going to donate to charity, do it personally and without all the media hype.

The money they give to charity goes to researchers, consumers, and so on. That money gets spent, moving back into the economy, which creates more jobs, start-ups, investments, donations to charities, etc. It's hard to say which route generates more benefit down the line; I have yet to see a robust economic model that handles even second-order effects well.

Media hype can be a good thing or a bad thing. If it's about your own ego, I agree, STFU and give privately. But hype can also convince others to change their behavior. Consider the use of "matching funds" as an incentive to increase charitable giving. Various publicity techniques (such as somebody famous emphasizing philanthropy) can increase giving or help direct it to where it can do the most good.

Re: Andreessen Horowitz to give half their earnings to charity

#72

Post by shantanubala »

daenz wrote: post #66
zmitri wrote: post #17

Earlier quoted context omitted.

It's unbelievable how much genius is wasted in poverty. What if those charitable dollars helped someone in an absolute destitute situation, who later turned out to be a success? Let me give you an example. In New York there is a non profit called "East New York Farms." If you aren't aware, East New York is one the roughest places you can come across in Brooklyn. They provide kids with the chance to run an organic gar…

> It's unbelievable how much genius is wasted in poverty. Examples of genius that didn't thrive because of poverty? The example you gave is about kids learning to sell vegetables. Are their studies about geniuses that didn't achieve their best work because they were poor?

That's not a very good question -- how can we know someone is a "genius" unless they have the resources to thrive? We can debate on the meaning of genius, but regardless of how you view it, a person simply cannot reach their full potential if they have to constantly worry about feeding themselves or a family.

Before we can even identify someone as a genius, they have to have been successful in some way. For them to be successful, they have to have access to at least some basic resources (there are "rags to riches" stories, but I'm not sure it's even possible to argue that those are the norm). So how would you even begin answering your question? How do we identify someone as a genius even before they've actually succeeded at something? Isn't there some massive selection bias there?

Since the only difference between a wealthy person and a person raised in poverty is income/upbringing (poverty doesn't change your genes, does it?), I think it's a safe assumption that we're missing quite a few "geniuses" because of poverty.

Re: Andreessen Horowitz to give half their earnings to charity

#73

Post by javert »

paul wrote: post #54
xenophanes wrote: post #48

Earlier quoted context omitted.

By giving half their profit to charity, one could take them as implying that profit is bad, that they don't deserve everything they earned, and that they are appeasing the irrational anti-capitalists (if not siding with them). I don't know anything about this particular case, but in general many businessmen are complicit in bad philosophy, and sometimes even pay to promote it. That's shameful and harmful. Business pe…

My job is helping people start business, and I do it in large part because I think it's good for the world, so you don't need to preach to me on the benefits of business. The mistake being made by many here is concluding that since business can be good for the world, therefore everything that isn't a for-profit business must be a waste. Not all good things are profitable.

you don't need to preach to me on the benefits of business

OK... fine. But if you aren't going to fully understand Ayn Rand's work, then you don't need to preach to us about how misguided you think it is.

The whole point of discussions like this is to have an intellectual discussion. To dismiss people who disagree with you by accusing them of "preaching" (when they aren't) has no place on HN. (As I'm sure you well know.)

Re: Andreessen Horowitz to give half their earnings to charity

#74

Post by daenz »

paul wrote: post #67
daenz wrote: post #60

Earlier quoted context omitted.

appeal to accomplishment, appeal to poverty, appeal to wealth http://en.wikipedia.org/wiki/List_of_fallacies

Capitalism is a system for transferring money from those who are bad at allocating capital to those who are good at allocating capital. That's the magic of it. It also implies that people like Andreessen most likely have an above average understanding of how to allocate capital :)

Doesn't make it any less a logical fallacy. Andreessen partners could wipe their asses with $100 bills. If someone with less money tells them that's a poor use of money, would you tell him clearly Andreessen knows better because they have more money?

Re: Andreessen Horowitz to give half their earnings to charity

#75

Post by alwaysdoit »

larrys wrote: post #52
paul wrote: post #41

It's sad to see so much misplaced cynicism here. If the partners had decided to keep 100% of their carry (as is typical) and used it to buy a bigger house or jet or something, nobody would comment or care. Instead, they've pledged to give half to some of their favorite charities, and some of you are acting as if it's a crime against humanity. Put away your Ayn Rand books (or whatever it is that drives you to such opi…

"sad to see so much misplaced cynicism here" Seems that over the last several years or so there has been an uptick in wealthy people using peer pressure to get other wealthy people to give away their money according to some rule of thumb that one groups thinks is right or fair. Wealthy people always gave away money and pressured others at charity events of course. But I don't remember it ever being so public. I have…

Did you miss the last two centuries where philanthropists built universities named after themselves (or their family members)?

"Surplus wealth is a sacred trust which its possessor is bound to administer in his lifetime for the good of the community." - Andrew Carnegie

Re: Andreessen Horowitz to give half their earnings to charity

#76

Post by cgag »

xenophanes wrote: post #48
paul wrote: post #41

It's sad to see so much misplaced cynicism here. If the partners had decided to keep 100% of their carry (as is typical) and used it to buy a bigger house or jet or something, nobody would comment or care. Instead, they've pledged to give half to some of their favorite charities, and some of you are acting as if it's a crime against humanity. Put away your Ayn Rand books (or whatever it is that drives you to such opi…

By giving half their profit to charity, one could take them as implying that profit is bad, that they don't deserve everything they earned, and that they are appeasing the irrational anti-capitalists (if not siding with them). I don't know anything about this particular case, but in general many businessmen are complicit in bad philosophy, and sometimes even pay to promote it. That's shameful and harmful. Business pe…

I don't see what's so wrong with implying that the might not deserve everything they earned, unless you also think people in poverty deserve to be where they are.

Re: Andreessen Horowitz to give half their earnings to charity

#77

Post by amirmc »

xenophanes wrote: post #48
paul wrote: post #41

It's sad to see so much misplaced cynicism here. If the partners had decided to keep 100% of their carry (as is typical) and used it to buy a bigger house or jet or something, nobody would comment or care. Instead, they've pledged to give half to some of their favorite charities, and some of you are acting as if it's a crime against humanity. Put away your Ayn Rand books (or whatever it is that drives you to such opi…

By giving half their profit to charity, one could take them as implying that profit is bad, that they don't deserve everything they earned, and that they are appeasing the irrational anti-capitalists (if not siding with them). I don't know anything about this particular case, but in general many businessmen are complicit in bad philosophy, and sometimes even pay to promote it. That's shameful and harmful. Business pe…

"By giving half their profit to charity, one could take them as implying that profit is bad..."

How do you make this leap? It's utterly baffling to me. Giving something away doesn't imply that it was bad to have in the first place.

Re: Andreessen Horowitz to give half their earnings to charity

#78

Post by moron »

jgmmo wrote: post #8

Bah! Entrepreneurs should reinvest their profits into more businesses. Profits are the reward you get for serving society effectively. Society would probably be better served if Bill Gates, etc. reinvested their cash instead of donating to charities. If charities actually cost-effectively served society than they would be a business instead!

I am glad a16z is run by the people who run it, and not you.

Re: Andreessen Horowitz to give half their earnings to charity

#79

Post by Blocks8 »

Giving is great. I wonder if down the road they will consider helping incubate these non-profits to make the return on their charitable investment even greater. They have the expertise of helping companies grow, why not give the money and brain power to help the charities too.

A side question, any idea if the contributions are from the firm or the individual partners? I'm curious about the tax break breakdown. If the company is the vehicle for donation, there is a larger ability for a full tax break on the money donated. However, it seems that for an individual, there is a maximum: "Only if you contribute more than 20% of your adjusted gross income to charity is it necessary to be concerned about donation limits. If the contribution is made to a public charity, the deduction is limited to 50% of your contribution base." - http://www.charitynavigator.org/index.cfm?bay=content.view&#...

So, if 100,000 was donated by the company, the tax break would be 100,000. $100,000 goest to the charity and the company has no tax on that income. But for the individual, if the maximum tax break is 50%, then $100,000 goes to the charity but $50,000 was taxed at the individual's income tax bracket (likely 35%+ for these guys) so the 'cost' was really $117,500 to give $100,000. Check my math here, I'm not a tax expert but curious about they are looking at maximizing their contribution at the lowest cost.

Re: Andreessen Horowitz to give half their earnings to charity

#80

Post by bksenior »

waterlesscloud wrote: post #51
paul wrote: post #41

It's sad to see so much misplaced cynicism here. If the partners had decided to keep 100% of their carry (as is typical) and used it to buy a bigger house or jet or something, nobody would comment or care. Instead, they've pledged to give half to some of their favorite charities, and some of you are acting as if it's a crime against humanity. Put away your Ayn Rand books (or whatever it is that drives you to such opi…

I think some of this is a result of the startup rhetoric about all the companies trying "change the world". If that were actually true, that all the effort and money going into startups was actually focused on changing the world, then wouldn't it naturally be better to reinvest the money into that system? Of course the reality, as we all know, is that it's only sometimes about changing the world, and sometimes it's a…

This seems a bit naive. One needs to continually generate resources to continue to be able to finically stomach bets on risky ventures (startups). It wold be the equivalent of a farmer giving away all his crops and not having money to fix the engine on his thresher the following harvest.

Dependent on the details this should be applauded. Although I think it would be much more interesting if they took part of their money and created grants for companies doing good in the world that would have trouble sustaining profitability.

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