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VCs are liars. And so am I.

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Re: VCs are liars. And so am I.

#101
post #79

Earlier quoted context omitted.

There is a sense of sustained confidence, of inevitability, of capability, that investors must look for in their founders. A person like this is bound to have a history of success, large and small. They can't help it. And none of these qualities are correlated to personality type or financial status. Such people are simply incessant creators. They cannot stop creating. You might try to stop them creating, and they wo…

What I usually say: Think big. Start small. Iterate often. If you aren't failing, you aren't learning (or trying). Money from customers beats money from investors. See if you can get that. And if you can't, find another metric for success.

Personally, I'd go more Zen. We are talking about inspiring deep, abiding, personal change after all.

More often than not we get in our own way. This is not something that you can consciously change, even if you are aware of it. There are several kinds of beliefs, and some of them are ingrained deep-down inside of you. We often make the mistake of thinking that our minds are like machines, which can be constructed in different ways - but minds are more like life - growing, changing, in lots of ways.

So the words must be seeds. It is easy to describe the outcome that you want, but very hard to construct a seed that will get the person there. So difficult, in fact, that it may not exist, or if it does it may take years to grow.

Learn to meditate. Learn to accept reality for what it is, learn to stop fighting reality. Learn to accept yourself and love and laugh and work with a vigor that you've only barely tapped.

Re: VCs are liars. And so am I.

#102
post #75

Earlier quoted context omitted.

The reality, as indicated in a recent Kauffman report is that the majority (actually, a super-majority) of venture capital forms perform poorly to the extent that they are not worth the management fees or continued investment. [1] This would indicate that VCs, on average, make poor judgement on the quality of their investments. The use of arbitrary indicators and qualitative characteristics as a primary decision fact…

We don't know the VCs have better indicators available. The mutual fund industry also interviews CEOs but largely invests based on data, and it has the same performance problems even among niche micro-cap funds.

The mutual fund industry almost certainly has the same problem that the VC community does - there's a form of cognitive bias that leads to people like VCs overestimating the effectiveness of their decision-making skills and seeing patterns that are not in fact there, causing them to make worse investment decisions than some hypothetical that was able to make a rational assessment.
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