741–750 of 864 posts
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Yes but they got screwed by incompetence at their bank. Why should the tax payer get screwed instead?
Because "they did nothing wrong" is his way of saying they are entitled to a taxpayer bailout
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Anyone who has really looked at the 2nd order effects. SV-style tech startups distribute more equity to employees than any other sector of business I know of and the average VC’s returns are worse than private equity, worse than the stock market and worse than real estate. You only hear about the biggest winners, but venture capitalists are taking on very long odds and the vast majority lose. More importantly, we all…
> such as this wonderful phone I’m typing this comment into that can access and search nearly any encyclopedia, map or song in the world in seconds, from almost anywhere. Cell phones were not created by tech startups.
What would I gain as a taxpayer in return for this bailout? Would the taxpayer receive 10% equity in YC? It seems like YC could have insured these funds, but didn’t. They saved money and accepted the risk. This risk is now realized. Seems bizarre that YC would be made whole. Certainly it saves jobs, but it benefits YC more than anyone else.
These are deposits at a bank. We're advocating for protection of 37,000 small business accounts, a small number of which are YC. We discovered about 30% of YC companies would not be able to make payroll even after the $250,000 insured amount if they were to wait months for their payments. That is detailed on the FDIC website currently as the process for remediation. This petition represents the lived experience of th…
They'll get 40% back next week, enough to make payroll for a while, and another 50% later (possibly much later), and for that second part they can find someone with big pockets to buy them out early at a discount.
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I get the thrust of the comment, but it's not a particularly good analogy. The petition signers are asking for the FDIC to prioritize their debt (deposits at SVB) repayment. They aren't asking for debt forgiveness.
I'm sorry, maybe I misunderstand, but they are asking for this 'Small business depositors at Silicon Valley Bank should be made whole', any good business should be aware of the max insured amount, so it sounds like they are asking for more than is specified by law (that they should have known about), and therefore asking the government to give them money that they knew was at risk. Currently given the regulations the…
In the case of students, they borrowed money that was not theirs, spent it and don’t want to have to repay it.
IMO student debt forgiveness has a major problem of essentially punishing those who did repay their debts and the many, many more who didn’t go to college in order to help those who borrowed and did not repay their debts. There’s an additional problem in that college costs are spiraling out of control, largely due to easy loans that students can never escape.
The solution I’d rather see is to let student debt be discharged via bankruptcy again. This would let people in a tough spot get a reset and it would also encourage lenders to be a bit more judicious and maybe even apply some downward pressure to tuition rates.
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VC backed founder here whose company is impacted by this. “Nepotistic trust fund baby” I am not. My family has no money, no connections. I went to Portland State University. I had no VC connections whatsoever. Our company was originally bootstrapped off of personal savings accumulated by working and living way below our means. No friends or family invested or gave us loans. I’ve had no inheritance and expect none. We…
Did you have more than $250k sitting in SVB? We're you unaware of the $250k FDIC insured limit? Or were you, and didn't act on mitigating this potential problem? Any particular reason?
Most banks don’t really like working with startups and sometimes freeze their money over AML controls that don’t play nicely with investor checks. If there’s a way to purchase insurance against this risk, I’ve never heard of it, and it’s probably too expensive for early stage startups.
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> Would the taxpayer receive 10% equity in YC? Make that 30–50 and we'd have a deal. Fucked up and want the state to rescue you? Fine, but your business is now mine, future profits and dividends (evabled by the bailout) will be distributed to all Americans, not just the handful of owners of "your" business. It's how the 2008 bailouts should have been handled, instead we got the biggest transfer of wealth from poor to…
The US government made $15B from the 2008 bailouts. That's 0.6% return on investment which is kinda poor but overall the bailout was profitable for US taxpayers.
if we ignore the hundreds (at least) of billions $$$ that the fed created and flooded the world economy with, in order to make that $15B "win" possible.
of course it was mostly non-Americans who ate the gigantic costs, thanks to the dollar's unique status as world reserve currency. but that just makes it worse, from a moral hazard POV.
YC has taken significant positions in their portfolio companies, which they rightfully boast are worth something like a collective $140B. They've also strongly encouraged their portfolio founders to use SVB, which made sense until the precise moment it didn't. What I don't understand is why YC itself doesn't allocate what appears to be a painful but survivable amount of its profits and bail out its own portfolio comp…
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I imagine some people flagged it so it doesn't get more views. How pathetic of YCombinator itself begging for a bailout.
This was my reason for flagging it. The balls to even try this, I'm enraged and the last thing I want is them getting more eyes. This truly shows the disconnect we are now living in. They said the quiet part out loud.
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Because "they did nothing wrong" is his way of saying they are entitled to a taxpayer bailout
kinda like student loan forgiveness, which would have penalized financially responsible people in favor of redditors.
But I think this is worse. Bailing out individuals is one level, bailing out massive banks is pure corruption.
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I am leaning libertarian and I am very sympathetic to this point of view. However, with the amount of taxes these companies pay and the economic growth they generate, they have every right to ask the question: when does the government benefit us ? If this very costly government is not able to guarantee the integrity of its federal reserve notes deposits, then what is its purpose? What makes it legitimate?
How is this the government's fault, unless you want to talk about tighter regulations? From a libertarian perspective, you deposit money at a bank, they make you sign documents about the well-known FDIC insurance limits (a bonus insurance offered by the government), and you make the free choice to mitigate whatever risks you think you have based on that 250K vs whatever you plan to deposit. It's essentially a busines…
Various organs of the government are claiming the authority to create and enforce financial regulations. And yet, cash deposits in government-backed currency at a 100% government-regulated bank can still vanish overnight.
Given the huge costs of maintaining this government, and given the similar benefits it provides to others (Wall Street bailouts, stimulus checks, student debt forgiveness, etc.), is it that unreasonable to ask what YC is asking?