This is basically cigar butt investing for the private market, as I doubt the most stable recurring revenue type businesses they seek to own are available at a low enough price to make it work for them.
Search Funds: The quiet, dependable, risk-averse sibling to the startup
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Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#12Search funds, like what the Valley's VC ecosystem has become, are just another disgusting way for rich turds to help their undeserving, underqualified progeny jump the corporate queue and look like they earned it.
If someone says he has a search fund, he's basically saying that he's rich and otherwise nonviable, so his Daddy got his friends to invest in his job search (and buy the company, so he becomes CEO). He's admitting that he wouldn't be able to make it in the world except for his father pulling a bunch of connections.
It exists because intelligence is probably 75% maternal and that fact pwns the shit out of alpha-male businessmen who impregnate trophy wives 30 years their junior who they married based on one criterion that isn't intelligence. They have stupid kids that they need to sell off on the world somehow, and search funds are great way to do it. However, if you look at some of the people getting funded, Valley venture capital seems to have eclipsed that avenue, because the sociopaths running the Valley have figured out that nerds want to put their heads down and will follow pretty much anyone who's raised VC.
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#13Search funds, like what the Valley's VC ecosystem has become, are just another disgusting way for rich turds to help their undeserving, underqualified progeny jump the corporate queue and look like they earned it. If someone says he has a search fund, he's basically saying that he's rich and otherwise nonviable, so his Daddy got his friends to invest in his job search (and buy the company, so he becomes CEO). He's ad…
What empirical evidence is there that intelligence is "75% maternal"?
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#14This is basically cigar butt investing for the private market, as I doubt the most stable recurring revenue type businesses they seek to own are available at a low enough price to make it work for them.
Cigar butt investing is a very interesting term. What does it mean?
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#15It seems strange to me that someone who doesn't have the risk appetite to start a business would think they are well suited to running one still in its early stages.
So you are arguing that in general one would want a ceo that makes riskier decisions? That seems pretty irrational.
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#16This is basically cigar butt investing for the private market, as I doubt the most stable recurring revenue type businesses they seek to own are available at a low enough price to make it work for them.
Cigar butt investing is a very interesting term. What does it mean?
Most people throw away the cigar butt, I imagine cigar butt investing is picking up other people's leftovers.
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#17Search funds, like what the Valley's VC ecosystem has become, are just another disgusting way for rich turds to help their undeserving, underqualified progeny jump the corporate queue and look like they earned it. If someone says he has a search fund, he's basically saying that he's rich and otherwise nonviable, so his Daddy got his friends to invest in his job search (and buy the company, so he becomes CEO). He's ad…
The last paragraph of this comment rather ruins it; there's no overwhelming evidence that intelligence is more "nature" than "nurture". The phenomenon is more likely to be reversion to the mean.
Having said that, buying your way into a job is a ridiculous situation that I thought we'd got rid of long ago along with buying commissions in the army.
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#18This is basically cigar butt investing for the private market, as I doubt the most stable recurring revenue type businesses they seek to own are available at a low enough price to make it work for them.
Cigar butt investing is a very interesting term. What does it mean?
It's a term value investors use for investing in "net nets", i.e. companies that trade below their net cash position. The idea is "if we can buy the cash at a discount and get the (crappy) company for free, at some point the market will pay at least for the full cash value".
The approach was made famous by Benjamin Graham and used by Warren Buffet in the first phase of his investing life.
Nowadays it's harder to find "net nets" as everybody and his dog can run a screen to find those companies now, so they get bid up above their net cash position most of the time.
Re: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#19Search funds, like what the Valley's VC ecosystem has become, are just another disgusting way for rich turds to help their undeserving, underqualified progeny jump the corporate queue and look like they earned it. If someone says he has a search fund, he's basically saying that he's rich and otherwise nonviable, so his Daddy got his friends to invest in his job search (and buy the company, so he becomes CEO). He's ad…
The last paragraph of this comment rather ruins it; there's no overwhelming evidence that intelligence is more "nature" than "nurture". The phenomenon is more likely to be reversion to the mean. Having said that, buying your way into a job is a ridiculous situation that I thought we'd got rid of long ago along with buying commissions in the army.
Evidence shows general intelligence in adults is .85 [1] (out of 1) [2] heritable. So, yeah it is predominately genetic.
Regression to the mean is a genetic phenomenon.
[1] http://cdp.sagepub.com/content/13/4/148
[2] http://en.wikipedia.org/wiki/Heritability
[3] http://en.wikipedia.org/wiki/Regression_toward_the_meanRe: Search Funds: The quiet, dependable, risk-averse sibling to the startup
#20It seems strange to me that someone who doesn't have the risk appetite to start a business would think they are well suited to running one still in its early stages.
So you are arguing that in general one would want a ceo that makes riskier decisions? That seems pretty irrational.
Growth is about risk. Calculated risk is core to making money.