How much money we can raise for transparently idiotic startups?
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Re: How much money we can raise for transparently idiotic startups?
#2If the proposal has "AI" in it, lots :)
But the comic beat me to it, I wish they were trying to be funny, but ...
Nice Comic BTW
Re: How much money we can raise for transparently idiotic startups?
#3One thing I noticed from the Sili Valley startups I've been involved with in the last 20 years: exec management's parents went to school w/ the funds managers.
I have this theory that there's institutional money burning a hole in various institution's collective pockets. Those funds' managers are under pressure to invest a percentage in risky, high reward opportunities. So they have money that has to be invested. You would look pretty stupid if you missed out on investing in the next Facebook or Google.
So you get some valley VC firms managed by guys who went to MIT, UCB or Stanford in the 80s and made their cash founding 90s era startups.
Now these guys' college room-mates have kids in MIT, UCB and Stanford who are about to graduate. So they (the VC's old room mates) channel some dosh into the VC's funds. In return, the VC's fund startups started by their room-mate's kids.
For the parent, it's great. They avoid estate taxes and if there's a profit, they only pay capital gains rates.
The kids receive their pay in perfectly laundered equity which at the next liquidity event can be reified outside the IRS' jurisdiction, so they wind up paying 12% corporate tax in Panama instead of the on-shored 26% cap gains rate.
All that's really required is a greater fool to take the series A shares off your hands when you do a series B.
My take on SiliValley is it's turned into a tax avoidant generational wealth transfer system for the financier class.
Nice work if you can get it.
Academia supports the system with hype-filled pronouncements about how future tech (AI, RISC-V, Battery Tech, WISC, etc.) will completely revolutionize the world.
Analysts who should have been taught skepticism when corporate leaders imply their startup will have a market value in excess of western Europe's GDP, jump on board to avoid looking like idiots on the off chance the firms they cover do take off.
Tech investing isn't a scam, there are definitely corners that are producing solid tech. But they're few and far between and very often not involved in the VC economy.
Re: How much money we can raise for transparently idiotic startups?
#4My head immediately jumps to YikYak but I know there were some others in this domain 10 years ago. I can't think of many recently though!
Re: How much money we can raise for transparently idiotic startups?
#5If the proposal has "AI" in it, lots :) But the comic beat me to it, I wish they were trying to be funny, but ... Nice Comic BTW
Hit the red button at the bottom
Re: How much money we can raise for transparently idiotic startups?
#6As anyone who lived through the dot com era…. a lot. Thanks for the comic. It was great.
Re: How much money we can raise for transparently idiotic startups?
#7Remember the dot-com bubble? Teenagers making millions creating simple static sites for desperate clients.. :D
Re: How much money we can raise for transparently idiotic startups?
#8One thing I noticed from the Sili Valley startups I've been involved with in the last 20 years: exec management's parents went to school w/ the funds managers. I have this theory that there's institutional money burning a hole in various institution's collective pockets. Those funds' managers are under pressure to invest a percentage in risky, high reward opportunities. So they have money that has to be invested. You…
> I have this theory that there's institutional money burning a hole in various institution's collective pockets.
That was very much the case before the Fed started raising interest rates.
The term "zero interest rate phenomenon" was created to describe it.
Now that rates are up, people sitting on piles of money can just put it to work in more traditional lending (e.g. buying bonds) instead of needing to look around for weird startups to put it in.
Re: How much money we can raise for transparently idiotic startups?
#9This isn’t just a poorly made joke it’s also not even making fun of the right thing.
The vast majority of investment is inside of public firms into themselves for ai.
VCs have actually broadly been sidelines as they both lack the capital to make major moves nor see small enough direct application to invest.
There are plenty of jokes to be made about AI, this is a dumb one.
Re: How much money we can raise for transparently idiotic startups?
#10I thought this was going to be a long form essay/prank/experiment, where someone launched a crowd funding campaign for a "transparently idiotic startup", and pulled off a $1M raise.
Ironically however, if you were to do that well, it would show high intelligence and creativity, which would probably make it an actual good investment.