261–270 of 360 posts
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Calculate the full chain of costs then come back here with how it compares to Transferwise or other methods
MXN to GBP : I can't do it. BTC to BTC :I can do it. Non of the fancy services allow me to send money from Mexico to the UK. It is crypto or paying for SWIFT, Western Union or similar. With very high costs.
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VC has historically done slightly better than the stock market, but returns over any time period are inversely correlated with how much money is flowing to VC (ie when everyone wants a piece of the action more bad deals are done, terms are better for companies etc) - so you'd expect the current period to produce okay returns (but probably less than the S&P). People imagine VCs return 100x or something, but if that re…
It seems like reasons you might invest in a VC fund could include portfolio diversification (if returns are counter cyclical or have low correlation with other asset classes), risk profile or expected performance. It would seem a little surprising if tech focused VC funds had low correlation overall with the NASDAQ but maybe it's the case. If it's mostly about risk profile and VC is riskier then at least according to…
A16Z’s unapologetic bet on cryptocurrency and blockchain companies is big for the industry. As crypto heats up again and blockchain 3.0 projects emerge (Cosmos, Polkadot, Ethereum Proof of Stake) VC will help legitimize the industry.
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It seems like reasons you might invest in a VC fund could include portfolio diversification (if returns are counter cyclical or have low correlation with other asset classes), risk profile or expected performance. It would seem a little surprising if tech focused VC funds had low correlation overall with the NASDAQ but maybe it's the case. If it's mostly about risk profile and VC is riskier then at least according to…
It's somewhat hard to calculate the correlation because VC is so illiquid, but for sure it provides diversity and has historically been an excellent investment. The variance across VCs is also huge relative to other types of asset managers, so you have the potentially for really obscene returns. If you have enough money that you don't need to be liquid it is a good investment.
a16z ("our" partner was Chris Dixon) led our seed round at Wit.ai. Working with them on a day-to-day basis was an incredible experience. They never asked for anything, but were always ready to jump in instantly when we needed anything from sales intros to offices in Palo Alto. When we got an offer from Facebook we founders wanted to accept it. They initially disagreed with us, but once we confirmed our decision they…
It's interesting this is the top voted comment when it isn't really substantive to the article's subject matter.
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It's somewhat hard to calculate the correlation because VC is so illiquid, but for sure it provides diversity and has historically been an excellent investment. The variance across VCs is also huge relative to other types of asset managers, so you have the potentially for really obscene returns. If you have enough money that you don't need to be liquid it is a good investment.
What you're describing doesn't sound like a particularly good investment. You replace the problem of picking stocks with the problem of picking VCs and have less liquidity. You have the potential for really obscene returns picking stocks too but there's no real reason to think picking VCs is any easier.
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Calculate the full chain of costs then come back here with how it compares to Transferwise or other methods
MXN to GBP : I can't do it. BTC to BTC :I can do it. Non of the fancy services allow me to send money from Mexico to the UK. It is crypto or paying for SWIFT, Western Union or similar. With very high costs.
BTC is a nightmare. You have to find an exchange in Mexico (which won't run away with your money a la Quadriga) and they'll take 1-2% and sit on the transfer for a few days. Then you have to transfer from there to another exchange in the UK paying a BTC exchange fee, then cash out in the UK, they'll take another 1-2%. In the week the exchanges have been camping on your money if you ever see it again, the forex risk is astronomical as it regularly swings +/- 20% weekly. Then due to the inevitable change in value of BTC during the week your transfer takes, you now have reporting obligations to your local tax authorities in BOTH Mexico AND the UK. This may require hiring an accountant to resolve which adds yet another mess of fees.
Pay a service 2-2.5% and be done with it or:
1-2% fee to Exchange 1 + a few days FOREX risk + the current BTC fee of $1.26 + 1-2% fee to exchange 2 + the risk anyone in the chain is going to ruin you because they're totally unregulated fly-by-night operations then learn the nuances of both Mexican and UK tax law in regards to capital gains.
This is a common crypto shill talking point. It's been thoroughly disproven that crypto is better for international remittences than existing solutions. It's a solved problem.
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A totally n00b question. Isn't VC the person with the money, so they are more in control. While an "investment advisor" is just advising or suggesting where the money can be put for maximum returns like an investment advisor in banks? So, presumably less in control. I don't understand why a title change was needed. Any technical or legal reasons?
wpennington answered the overall question better than I could, but one clarification on this: > Isn't VC the person with the money, so they are more in control. Most of the money VCs invest isn't their own. The money is allocated by "limited partners" (entities such as pension funds, endowment funds, sovereign wealth funds, rich individuals/families), and the VC firm uses their expertise and network to invest the mon…
> Most of the money VCs invest isn't their own.
To underscore tomhoward's point--VCs are largely (already) stewards of other people's money (their LPs). So while they are set up to be "the person with the money" from the market's perspective (e.g., if you are looking to get your company funded), they are acting as investment advisors (e.g., where and how to spend the fund's money--and by extension the LP's money--for a fee). Albeit with a specific legal exemption set forth in the Investment Advisers Act that governs certain activity depending on how they are registered* (this is what is changing for a16z). No matter how they are registered, they do have compliance requirements as custodians of other people's money.
*Under the Investment Advisory Act, they can be registered as: (1) ERA - exempt reporting advisor (what we are referring here as a VC in the traditional sense), or (2) RIA - registered investment advisor.
As it relates to a16z, they are giving up their IAA exemption as a fund (registering as an RIA vs ERA). No need to get into why that matters again (see other posts that have already addressed it well). The point being, VCs are already in many ways "investment advisors" as custodians of other people's capital (and sometimes their own) through their funds and they have compliance requirements, just different depending on how they are registered.
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Calculate the full chain of costs then come back here with how it compares to Transferwise or other methods
Well… Cost: a) BTC-BTC Transfer: Only BTC transfer fee. Beats TransferWise by a large Margin. b) BTC-USD: Depends on many variables, including if the receiving country taxes BTC to fiat. Considering how expensive transferwise is, it's probably a wash. Speed depends on if GP literally meant Cash. If so, BTC is obviously far faster and easier as you still need to get you cash into your bank account. Otherwise… Transfer…
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Some people think this is a problem. Others, a feature. At least now we have the ability to see what happens.
You can have decentralized money without crypto - just use gold parity - but somehow no country uses it now. Maybe they are all corrupt - but maybe it is just not good way to manage the economy.
Competing tethered currencies aren't gone because they're a bad idea, they're gone because they've been made illegal.
Crypto gives the power to operate such a currency back to the people in a way that can't be stopped.