Andreessen Horowitz to give half their earnings to charity • Hacker News Board

Re: Andreessen Horowitz to give half their earnings to charity

#21

Post by yesbabyyes » Wed, Apr 25, 2012, 9:57 PM UTC

jgmmo wrote: post #14

yesbabyyes wrote: post #13

Earlier quoted context omitted.

How about you decide what you do with your money, and Bill Gates and Marc Andreessen decide what they do with their money?

Well of course I'm not suggesting we forcibly make them do anything with their money. I am just saying, in terms of societal net benefit, we are probably much better off if our most successful investors continue investing in more businesses rather than charities. Not a fan of thought experiments?

I assure you that there are lots of wealthy people who reinvest their money into more businesses, so I'm not sure of the value of your thought experiment. There seem to be fewer wealthy people giving half their fortune to charity. Not a fan of real-world experiments?

Re: Andreessen Horowitz to give half their earnings to charity

#22

Post by zfran » Wed, Apr 25, 2012, 10:00 PM UTC

jgmmo wrote: post #14

yesbabyyes wrote: post #13

Earlier quoted context omitted.

How about you decide what you do with your money, and Bill Gates and Marc Andreessen decide what they do with their money?

Well of course I'm not suggesting we forcibly make them do anything with their money. I am just saying, in terms of societal net benefit, we are probably much better off if our most successful investors continue investing in more businesses rather than charities. Not a fan of thought experiments?

>I am just saying, in terms of societal net benefit, we are probably much better off if our most successful investors continue investing in more businesses rather than charities. Not a fan of thought experiments?

Exactly, WE. Thing is, there are millions of people that aren't included in that "we" and the benefits they get (i.e. saving lives) FAR outweights the benefits we'd get.

Re: Andreessen Horowitz to give half their earnings to charity

#23

Post by leot » Wed, Apr 25, 2012, 10:02 PM UTC

yesbabyyes wrote: post #19

jcampbell1 wrote: post #10

I am frankly a bit saddened by this. These guys are some of the best in the world at deploying capital. Humanity would be better served if they continued to invest their own money. Now these guys half-work for some charity, and when the charity doesn't deliver great results, they will feel like they are half-working for little results. It is a mistake for the best capital allocators to pledge future earnings. They sh…

You are saddened by other people giving money to charity? As in, that makes you sad? As stated in the fine article, this is their management fees. So e.g. when they invest $1.5 billion, they will give about $15 million to charity. It saddens me that you rally on these friggin' aces instead of people not putting their money to work, nor giving it to charity.

... this is the untold story of the quietly wealthy; the millions of smart, capable people with vast reserves of capital who do their darndest to make sure they don't have to do anything at all.

Re: Andreessen Horowitz to give half their earnings to charity

#24

Post by vibrunazo » Wed, Apr 25, 2012, 10:02 PM UTC

jcampbell1 wrote: post #10

I am frankly a bit saddened by this. These guys are some of the best in the world at deploying capital. Humanity would be better served if they continued to invest their own money. Now these guys half-work for some charity, and when the charity doesn't deliver great results, they will feel like they are half-working for little results. It is a mistake for the best capital allocators to pledge future earnings. They sh…

I generally agree with the whole "wait till you get rich then donate to charity" sentiment. But it's hard to tell when you're rich enough. It would be a risky bet either way. You can't be sure how much more you'll be able to make your earnings grow in the future, just as you can't be sure if your charities will pay out.

And the longer you wait, the longer those charities you could have been investing on, are not seeing any benefits.

So you have two balance these two: Wait too long and charities of today don't see much benefit. Wait too little and you might be unable to grow your money and do less overall charity in the future. How do you know what's the right point in your career? Ideally, you wanna start donation when you're at the top of your career. And don't wanna risk falling from where you are.

After the recent investments maybe Andreessen Horowitz think they got to that point. They've got more money than ever and it's getting riskier to wait longer. So they considered that balance and judged it was the right time to donate to charity. You might disagree with their timing. But hey, remember they're pretty good at this stuff, so maybe they're right :)

Re: Andreessen Horowitz to give half their earnings to charity

#25

Post by rjshade » Wed, Apr 25, 2012, 10:02 PM UTC

rjshade wrote: post #18

This is great. Something people often disregard, but which is hugely important, is charity effectiveness. This boils down to measuring the impact that you can make with a given donation: it turns out some charities are literally thousands of times more effective than others. A lot of people don't realise how much good they can do with modest donations to the right charities -- until a year ago I really had no idea my…

Oh and this is similar to the approach that the Gates foundation is taking. As far as I can tell Gates approached this as an optimisation problem: given that he has X billion dollars to give to charity, how can he maximise the effect that his donations have? How many lives can he save* with that money?

* lives saved is of course the wrong metric: no-one has ever saved a live, just prolonged it, but it's a convenient shorthand for maximising the number of quality adjusted life years (QALYs)[1] that a donation could buy.

[1] http://en.wikipedia.org/wiki/Quality-adjusted_life_year

Re: Andreessen Horowitz to give half their earnings to charity

#26

Post by peterjs » Wed, Apr 25, 2012, 10:05 PM UTC

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!

Is that irony or ignorance? There are plenty of things worth doing that do not have a viable business model. How would you achieve the goals of the two nonprofits mentioned in the article? There are really no short term benefits from protecting the environment or helping families become self-sufficient. It takes years for trees and families to grow and measuring the economic value of these investments is not straightforward.

http://www.shelternetwork.org/ http://canopy.org/

Re: Andreessen Horowitz to give half their earnings to charity

#27

Post by vibrunazo » Wed, Apr 25, 2012, 10:08 PM UTC

zmitri wrote: post #17

jcampbell1 wrote: post #10

I am frankly a bit saddened by this. These guys are some of the best in the world at deploying capital. Humanity would be better served if they continued to invest their own money. Now these guys half-work for some charity, and when the charity doesn't deliver great results, they will feel like they are half-working for little results. It is a mistake for the best capital allocators to pledge future earnings. They sh…

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…

I think you've misread his post. He's talking about donating what they have now VS donating more money after they get richer in the future. He's not talking about donating to charities VS donating to kids from top universities. The second would just be a consequence of the first.

Re: Andreessen Horowitz to give half their earnings to charity

#28

Post by jcampbell1 » Wed, Apr 25, 2012, 10:10 PM UTC

danilocampos wrote: post #20

jcampbell1 wrote: post #10

I am frankly a bit saddened by this. These guys are some of the best in the world at deploying capital. Humanity would be better served if they continued to invest their own money. Now these guys half-work for some charity, and when the charity doesn't deliver great results, they will feel like they are half-working for little results. It is a mistake for the best capital allocators to pledge future earnings. They sh…

> when the charity doesn't deliver great results, they will feel like they are half-working for little results. What information do you have about their decision making process that makes you believe that they will select charities that don't deliver great results? What about success in venture capital, in your view, would prevent these individuals from successfully selecting/starting/advising philanthropic endeavors…

Getting results from charities is hard. Bill Gates quit his job to solely focus on this. Warren Buffet pledged all his money to Gates because he doesn't think he would be particularly good at it.

My point is, why pledge earnings rather than wealth? I think pledging earnings is risky, and the world is better off because Warren Buffet did not do it.

Re: Andreessen Horowitz to give half their earnings to charity

#29

Post by _delirium » Wed, Apr 25, 2012, 10:12 PM UTC

vibrunazo wrote: post #27

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…

I think you've misread his post. He's talking about donating what they have now VS donating more money after they get richer in the future. He's not talking about donating to charities VS donating to kids from top universities. The second would just be a consequence of the first.

When do you stop, though? If you take the "first I'll get rich, then work on charitable causes" route, and Andreessen Horowitz aren't yet rich enough to qualify, what level is rich enough? Does it have to be $100 billion or something before you're allowed to decide it's time to start diverting some money to charity?

Re: Andreessen Horowitz to give half their earnings to charity

#30

Post by wdewind » Wed, Apr 25, 2012, 10:23 PM UTC

daenz wrote: post #16

Though I'm not religious, there's a specific set of bible verses I think of when I see news of someone being publicly charitable: 1 Take heed that you do not do your charitable deeds before men, to be seen by them. Otherwise you have no reward from your Father in heaven. 2 Therefore, when you do a charitable deed, do not sound a trumpet before you as the hypocrites do in the synagogues and in the streets, that they m…

What about when your deed might inspire/put pressure on people of similar stature to do the same? Ie: Gates or AH?