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SVB collapse could mean a $500B venture capital ‘haircut’

bloomberg.com

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Re: SVB collapse could mean a $500B venture capital ‘haircut’

#11

Post by spaceman_2020 »

cs702 wrote: post #4

Startup valuations had gotten too rich. Now they're coming down to more reasonable levels, in fits and starts. VCs and their LPs don't want the write-offs. They're painful. But ultimately, I think the write-offs will prove healthy.

I also think that tech is moving very fast, and startups with 10+ years of unprofitable existence without any potential exit are going to get disrupted by newer players.

The current crop of startups have largely been pioneers, but usually, the settlers take away the bulk of the spoils.

In India, Uber got everyone used to the idea of app based cabs. Now newer players are eating away Uber’s lunch with newer models and without having to spend any money on educating customers or drivers.

Re: SVB collapse could mean a $500B venture capital ‘haircut’

#12

Post by deltree7 »

gigatexal wrote: post #6

Good. All those 0% interest leveraged VC funds can go burn in a fire. They pumped stupid money into companies and inflated valuations. Now that things are getting saner with real interest rates above 0 and getting higher sanity will reign again in the markets.

It's delusional to think that this won't have effects on most HNers employment/salary.

So be careful what you wish for

Re: SVB collapse could mean a $500B venture capital ‘haircut’

#13

Post by bbbbzzz1 »

deltree7 wrote: post #12
gigatexal wrote: post #6

Good. All those 0% interest leveraged VC funds can go burn in a fire. They pumped stupid money into companies and inflated valuations. Now that things are getting saner with real interest rates above 0 and getting higher sanity will reign again in the markets.

It's delusional to think that this won't have effects on most HNers employment/salary. So be careful what you wish for

More tame inflation for people who maintain their good paying jobs will be in an even better position

Re: SVB collapse could mean a $500B venture capital ‘haircut’

#16

Post by varispeed »

The whole idea of venture capital comes from the broken taxation model. The people who actually produce things, you know doing the work and have knowledge how to do something are burdened with heavy taxation, because years ago, when companies had high headcount, it was a way to make companies pay taxes. Now that everything gets offshored, including work, that model doesn't work anymore, but politicians for known reasons (corruption) don't want to change that, so to plug the tax gap, they increase taxes on labour and continue the squeeze, while not touching the big companies and the rich. This has created a situation, where educated and hardworking people can't amass enough capital to start their own business and their only way to get their idea running is to beg venture capitalists for money in exchange for a slice of their business or banks for a loan.

This has created a divide and widens the inequality gap on a scale not seen before in our lifetimes.

The rich get extremely rich, because they don't pay the same taxes as labour and they have so much money they own politicians and can make sure the status quo never changes.

This has caused things like "quiet quitting", because people no longer see work is worth anything anymore if you can't progress your life in any meaningful way.

All ladders to wealth and fulfilment that our parents and grandparents had have been destroyed.

Re: SVB collapse could mean a $500B venture capital ‘haircut’

#17

Post by jjtheblunt »

deltree7 wrote: post #12
gigatexal wrote: post #6

Good. All those 0% interest leveraged VC funds can go burn in a fire. They pumped stupid money into companies and inflated valuations. Now that things are getting saner with real interest rates above 0 and getting higher sanity will reign again in the markets.

It's delusional to think that this won't have effects on most HNers employment/salary. So be careful what you wish for

What? Why do you think HN readers are working for companies impacted or dependent on some way?

I conjecture a huge fraction are entirely independent of SVB FDIC shenanigans.

Re: SVB collapse could mean a $500B venture capital ‘haircut’

#20

Post by [deleted] »

deltree7 wrote: post #12
gigatexal wrote: post #6

Good. All those 0% interest leveraged VC funds can go burn in a fire. They pumped stupid money into companies and inflated valuations. Now that things are getting saner with real interest rates above 0 and getting higher sanity will reign again in the markets.

It's delusional to think that this won't have effects on most HNers employment/salary. So be careful what you wish for

[deleted]
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