[HN Gopher] Terrible things I'd do with your money
___________________________________________________________________
Terrible things I'd do with your money
Author : timdaub
Score : 138 points
Date : 2022-04-15 15:15 UTC (7 hours ago)
(HTM) web link (timdaub.github.io)
(TXT) w3m dump (timdaub.github.io)
| krisoft wrote:
| I find it very curious that the article doesn't mention self
| driving vehicles. To me that is an example for a daring risk
| undertaken mostly by VCs.
|
| The upside is huge. If we can make a robotic system which can
| safely pilot a vehicle on our existing roads, and make it
| commercialy viable that will reshape how transportation is done,
| how cities are built, and how people live.
|
| Is it risky? Oh yeah. Everyone knows that computers are full of
| faults, sensors are crappy, hardware breaks all the time and
| every software is a pile of bugs. These are given, and unlikely
| to just change on their own. Can we, despite all the above
| engineer a system which provides superhuman level of driving
| safety, yet it costs less than a driver on the local minimal
| wage? This is the premise of a self-driving car.
|
| Follow on question: is it possible to get there from here without
| antagonising the public with accidents? If a restaurant gives
| food poisoning to folks on the other side of town that won't
| affect your restaurant's business. Any self driving accident
| happening anywhere on the earth have the potential to ratchet up
| the scrutiny on every other companies. ( Think of something
| Hindenburg disaster equivalent.)
|
| I believe the answer is yes we can, it takes carefull engineering
| and a lot of work but it can be done without needing to invent
| general artificial inteligence. VCs seems to agree with me
| because they are positively pumping money into companies in this
| field. What is that if not risk taking?
| dasil003 wrote:
| Self-driving cars have huge technical risk, and some public
| opinion risk, but what trumps that is massive indisputable
| upside that has been a dream since the automobile was created,
| and has seen active research and prototyping for decades at
| this point.
|
| VCs are very willing to take that kind of calculated risk. They
| are also willing to chase crypto and AI due to FOMO (leading to
| the observed herd mentality).
|
| But in terms of novel ideas that could be game changing but
| don't have a lot of mindshare or a clear path to market, they
| ain't touching those things.
| Mikeb85 wrote:
| > "VCs are sheep."
|
| Of course. Because the whole point is to cash out when other
| (later) sheep pile in...
|
| > VCs don't take (enough) risks. And neither do startup founders.
|
| Because investors in the coming rounds are risk-averse and want
| something they can understand. The VCs just want to cash out.
|
| > The Utopia of Creative Freedom
|
| Lol. Unfortunately it won't last long.
| woah wrote:
| > I dream of the freedom to work on what I think is right - for
| how long I think is good.
|
| > I dream of not owing responsibility to my employers or
| financiers. The utopia of creative freedom, where no budget
| limitations, no sense of scarcity, or fear of failure exists.
|
| > I dream of a place where financiers understand my desire to
| take risks, a place where not only engineers have empathy towards
| the business but vice versa.
|
| > It's there where I'd waste your hard-earned dollars on days of
| "unnecessary" and tangential work.
|
| > It's where I'd rent servers to compute seemingly useless shit -
| where I'd blow tons of carbon dioxide into the atmosphere just to
| gather more, to you, irrelevant information.
|
| > If I had all the creative freedom in the world, I'd do
| "terrible" things with the money you invested.
|
| This guy should get into crypto
| BasilPH wrote:
| He is into crypto.
| jmmcd wrote:
| I googled "notorious lying woman posing as female Steve Jobs" and
| - credit where it's due - it seems to have given the right
| result.
| timdaub wrote:
| this made me happy, thanks for testing and reporting :)
| vasco wrote:
| I play a game with friends where we try to come up with the
| most obtuse query that will still return the right answer from
| google. It's incredible the type of things it can understand.
| agentultra wrote:
| I'd be happy building a personal computing system that wasn't
| centred around a glowing screen and keyboard. One where the
| "computer" is practically invisible and hidden from view. Think
| decentraland, screenl.es, etc. e-Ink tablets, chalk boards,
| voice, gesture... any humane interface that works for you would
| be suitable rather than distinctly designed experiences sold to
| you.
|
| It came from a dream of wanting to be able to do my job, software
| development, with theorem provers and code synthesizers using
| interactive assistants and hand-writing recognition on e-Ink
| devices. It'd be nice to have a space that was truly intuitive in
| the human-scale sense: a device that isn't a device; that doesn't
| slowly ruin my body as I adjust myself to it, etc. A device that
| wasn't co-opted to keep me engaged and spending, spending,
| spending.
|
| It'd also be nice if I could build these things out of commodity
| parts with commodity interfaces so that we can up-cycle and
| maintain these computers well into the future without dumping
| them every few years for the new shiny.
|
| ... it's a distinctly _uncapitalist_ computer which is probably
| why I 'll never be able to build it unless I win the capitalist
| lottery.
|
| But hey, one can dream. f-u money is what I look forward to.
| motohagiography wrote:
| More than once I have said that some startups would do a lot
| better if they used half the money they got from their last
| round, bought a few grams of mushrooms for everyone, and then set
| the rest on fire on a beach somewhere, but for a very specific
| reason. There are legit complaints about VC's as a whole, but
| being risk averse is not one of them, and one from someone
| heroically accepting a regular paycheque and a snack fridge from
| one of their companies every two weeks, calling them out on risk
| aversion does seem a bit rich.
|
| The reason is too much cash takes the focus off product and turns
| it inward and creates a zero sum competition internally among
| managers to loot the excess money instead of focusing on growth
| from real revenue. Economically, at least the fire would be
| deflationary. Cash is literally fuel, and unless you can put it
| into something that grows, it's a volatile nuissance whose fumes
| impair judgment. If you want to destroy a product and a company,
| get them indexed on unlocking a covenant or raising another round
| where the execs get bonused out of it.
|
| Cash is what you have when you don't have product market fit and
| (I think) it creates a culture that repels customer desire. Why
| make anything someone wants when you have enough runway to tinker
| with what you want for yourself, maybe some follie that you can
| speak at conferences about, or the best devops and ci/cd pipeline
| to nowhere?
|
| I'm harsh about this because investors buy a ticket for a growth
| ride, and the best ones are diversified enough that they really
| do just buy the ticket and take the ride. But watching engineers
| iterate on refining the exeuction of solved problems, managers
| focus on "getting resources," and sales acting like the abused
| secret side partner to some flagship account they're fronting to
| attract investor/acquirer interest - are all just spinning
| wheels, imo.
|
| There are lots of legit complaints about VCs, particularly around
| financial engineering, and some negative culture issues from the
| teams they can parachute in, but even as an admitted serial IC
| technologist, the article embarasses me.
| jedberg wrote:
| > There are legit complaints about VC's as a whole, but being
| risk averse is not one of them,
|
| I strongly disagree. Most VCs are very risk averse. They just
| pattern match to previous success, or "wait for someone to take
| the lead".
|
| Only the top VCs are risk takers -- most of the rest just
| follow on for the ride.
|
| Angel investors are much more willing to take risks than VCs.
| placidpanda wrote:
| I don't think it's actually risk aversion or not.
|
| The risk is not precisely and exactly quantified. The
| uncertainty isn't precisely quantified. This isn't an
| experiment where someone is asked "Would you like to have $2,
| or flip a coin and get $5 if its heads, or roll a die and get
| $16 if it's a six?"
|
| I think it's more about how they are estimating risk in
| different areas, and ways in which one might commonly see
| people overvalue or undervalue risk, or overvalue or
| undervalue potential payoffs. It's not that they're trying to
| be more conservative, their incorrect calculation just makes
| one option seem like a bad (or worse idea) than another.
|
| An alternative viewpoint is that maybe their risk calculation
| isn't actually wrong and they're not risk averse, they're
| just taking the strategy of only making decisions that don't
| make you look foolish and can be blamed elsewhere if you
| lose, but can take credit when you're lucky and they win.
|
| Saying yes to 2$ over a coin flip to $5 is risk aversion.
| Saying no to $3 so you can coin flip for $5 is probably just
| foolish.
| jedberg wrote:
| Most risk is not quantifiable like that. Very few things
| are as clear cut as gambling. Most risk is in the form of
| "should I try to swim across this rushing river or risk
| going downstream to look for a bridge".
|
| That risk isn't quantifiable. But if you're in a national
| park, you know there is a good chance there is a bridge, so
| you pattern match what you know about national parks and
| decide that looking for a bridge is less risky, knowing
| your priors.
|
| VCs operate the same way. They know that in the past they
| funded two founders from MIT making a marketplace, so they
| are far more likely to put money into that again than
| something from a solo female founder who never went to
| college.
|
| That's why I say they are risk averse.
| robbomacrae wrote:
| "I'm harsh about this because investors buy a ticket for a
| growth ride, and the best ones are diversified enough that they
| really do just buy the ticket and take the ride. But watching
| engineers iterate on refining the exeuction of solved problems,
| managers focus on "getting resources," and sales acting like
| the abused secret side partner to some flagship account they're
| fronting to attract investor/acquirer interest - are all just
| spinning wheels, imo."
|
| -- that was an incredibly well written and succinct summary of
| the the dangers of over funding. I couldn't agree more!
| drc500free wrote:
| It's certainly a different way of thinking about your burn
| rate.
| dsugarman wrote:
| They are for sure risk adverse and they for sure act like
| sheep. Most VCs would agree with that in private, if not about
| themselves, about the space in general. They all like betting
| on hot startups in hot spaces, there's a lot of big winners and
| big losers in that group. Almost no one wants to bet on a not
| hot space and almost no one wants to be the first investor in a
| company. All due diligence goes out the window when a company
| is red hot and you aren't expected to do any because look at
| all the other big names that presumably did.
|
| Almost no one wanted to bet on Coinbase in 2012 but everyone
| wanted to bet on all of these derivative crypto projects after
| Coinbase and bitcoin were killing it.
| nonrandomstring wrote:
| > bought a few grams of mushrooms for everyone, and then set
| the rest on fire on a beach somewhere,
|
| Whatever happened to Josh Harris of pseudo/quiet? In that weird
| but prescient doco "We live in public" he says something like
| all the guys he knew who made dotcom fortunes "wasted their
| money" by not blowing the lot on "surveillance art" millennium
| apocalypse parties. And KLF certainly made a lasting myth,
| whether they torched the wonga or not.
|
| I am just pondering the power, ethics and potential of
| conspicuous destruction of ones own wealth. There's something
| profane in this, in a world where it's getting harder to find.
| Wouldn't it be funny if Musk bought Twitter, and simply shut it
| down, and pissed off on vacation with no contactable number.
| scruple wrote:
| > Wouldn't it be funny if Musk bought Twitter, and simply
| shut it down, and pissed off on vacation with no contactable
| number.
|
| I've honestly had the same thought rattling around in my head
| during this entire spectacle. It'd certainly be the boat
| interesting outcome.
| kingcharles wrote:
| The KLF were just ahead of their time. Now they could launch
| a DAO and everyone could own a share of the burnt wonga and
| they could sell NFTs of it and open a fast-food chain where
| everyone can pay with burnt twenty quid notes.
| agentwiggles wrote:
| One of my favorite software devs I've worked with once told
| me that if he were elected president, his first and only
| action as president would be to abolish the presidency and
| then return home.
|
| Obviously not actually plausible, but I got a kick out of his
| sincerity on the topic. (If you're out there, Dan, hi!)
| imtringued wrote:
| If I had to summarize the problem it would be that there is too
| much financial capital and no market signal to tell people to
| stop producing more financial capital.
|
| You have this huge amount of money that you must dispose of for
| which you demand x% of return. All those startups can deliver
| x% returns but they can't use all of your money. So you stop
| giving them money and instead give it to those that are
| promising x% and taking as much funding as they can get their
| hands on, fully aware that they could run their business with
| much less funding and then you end up with all these absolutely
| gigantic money losing unicorns with the hope that you can sell
| them to other investors and let them be stuck with the loss by
| telling them that some sort of monopoly forms which will make
| it worth it.
| istinetz wrote:
| And what _are_ the dazzlingly original ideas that the world does
| not let you work on?
| leodriesch wrote:
| Who is meant to be the "female Steve Jobs" he is talking about?
| azornathogron wrote:
| Elizabeth Holmes, founder of Theranos and convicted fraudster.
| And note that he doesn't refer to her as the female Steve Jobs,
| but as the "lying woman posing as female Steve Jobs".
| javajosh wrote:
| "A Room of One's Own" (2022 edition)
| mc4ndr3 wrote:
| Where I've worked, pinning the major version of dependencies,
| where no version information had been pinned, was considered "too
| risky".
| dleslie wrote:
| There's no pay off to this article. The thesis and justification
| for the position are there, but the author leaves you hanging.
| Just what are those terrible things?
|
| Surely not:
|
| > It's there where I'd waste your hard-earned dollars on days of
| "unnecessary" and tangential work.
|
| > It's where I'd rent servers to compute seemingly useless shit -
| where I'd blow tons of carbon dioxide into the atmosphere just to
| gather more, to you, irrelevant information.
|
| There are very few individuals that I would trust to create
| something of value in an unstructured environment. At the very
| least, for most people I would want to hear about their approach
| to foster creative thought, turn that into actionable designs,
| experiment and discard and iterate.
| kingcharles wrote:
| Snorting coke off a strippers chest. That was what he was going
| to write. That's what I will do with your seed money. It was
| even in the "business" "plan" you never read. Also, NFTs
| something.
| vasco wrote:
| Not only I wouldn't trust that, I'm sure they wouldn't if they
| think the only reason is lack of VC money.
|
| There's no need for VC money to unleash creativity and create
| cool things, this is just the author blaming others for their
| inability to hit whatever weird creative standard they set for
| themselves. "If only they'd let me I'd change the world". The
| things that cognitive dissonance can make you believe are
| incredible.
| [deleted]
| erwincoumans wrote:
| Agreed, limits don't prevent creativity and creating cool
| things, often they are encouraging.
| NateEag wrote:
| Sufficient constraints do prevent it, though.
|
| I have some (to me) fascinating and promising ideas about
| tooling around managing software specifications. I also
| have strong opinions about version control and some core
| ideas about how I'd like it to work.
|
| I'm a primary breadwinner husband and father of three
| children who lives far from any tech hubs.
|
| That makes it rather difficult to spend much time or energy
| on those problems to realize the ideas I've got.
|
| I strongly agree that constraints help creativity, but you
| can have enough to weigh it down rather than help it.
| nraynaud wrote:
| I have felt terribly alone at some "disruptive" startups. What's
| weird is that at least in a few occasions I proposed things that
| became a trend later (like using AWS EC2 for computation
| immediately when it was created, today "cloud" is a buzzword).
| MrYellowP wrote:
| If I had a million euros, I'd buy several apartments in my area
| ...
|
| ... and I'd buy long lasting food and store it in said
| apartments.
|
| It will be easy having security guarding it, at least for me
| personally,
|
| and when the time comes, which it will, I'll start making sure
| people around me have food and water.
| ljhsiung wrote:
| I want to focus on this bit.
|
| > [I] would like to see is increased risk-taking in the workplace
| [...] I want to blow up the scope [1], but they won't allow me
|
| While I generally agree with the sentiment, let me offer a
| devil's advocate position to counter the whole "woe is me, I am
| but a 10x engineer suffocated by the evil VCs and PMs of the
| world who keep asking for dumb jira updates. If they stopped
| asking for updates, I'd give it to them in 5 years" narrative.
|
| There are similar criticisms in academia-- "The bean-counting
| administrators need some dumb metrics (num papers, num citations)
| for tenureship". While these are valid criticisms, the
| alternative is not one I'd prefer.
|
| Consider someone who _does_ make grandiose claims, but pushed
| back against those who ask for "updates" or "metrics". Elizabeth
| Holmes is cited as one such person with "[going] all-in; mega
| bold and despite the odds stacked against them". But this example
| actually is a warning that goes against the point of the article,
| I feel. The "evil VCs" full-heartedly trusted her. Are you
| telling me that if the VCs just took more risk, she would have
| succeeded? But instead, they basically margin called her and
| screwed her over because they were too risk-intolerant?
|
| W.r.t Holmes, I actually place a small amount of fault on her.
| It's good to dream big. I place more fault on the VCs for not
| being "bean-countery" enough, because anybody with proper
| auditing would be able to see the issues there, instead of
| blindly trusting "oh this $100mil is for R&D, just trust me. You
| need to take risks for this world changing blood testing
| methodology."
|
| The takeaway is-- there's a reason scope might be restricted. In
| academia, there's a notion of a "publon" [2], the smallest
| "quantum" of knowledge that can be published (ha! I love that
| name). The idea is, no matter how large a project might be, it is
| segmentable, and if it is not segmentable, it's not a good
| project. Furthermore, publishing is THE mechanism of which
| scientists get feedback, and feedback is critical to our
| iteration process.
|
| (Again, as I mentioned, there are tons of problems with the
| "publish or perish" culture, which I could also go on forever
| about, but preferable IMO to the alternative of publishing a
| magnus opus every 10 years).
|
| We can generalize that concept to most things. Feedback and
| metrics are critical inputs to iteration. You can certainly
| criticize these metrics, but you can't JUST say "take more risk"
| without providing alternative data to update a VC's investing
| strategy. You want them to accept your giant ass scope? Give them
| better data. Help them help you.
|
| For another example-- Consider a project that's been going on for
| almost 20 years. Mill Computing [3]. They have established some
| pretty massive scope, and it's a goal I support. But do we (the
| public) have much insight as to what they're doing, precisely?
| Not really. They most definitely have their reasons, I'm sure,
| but I, as an outsider, know very little about how they are
| achieving their goal. So then why would I invest in them?
|
| [1]: https://timdaub.github.io/2021/06/18/when-scope-blows-up/
|
| [2]: https://en.wikipedia.org/wiki/Least_publishable_unit
|
| [3]: https://millcomputing.com/
| gumby wrote:
| > "VCs are sheep. They don't take risks."
|
| They have jobs and customers just like anyone else, even though
| many of them don't like to frame things that way. Every fund's
| prospectus talks about the GPs' philosophy, thesis and focus;
| every LP talks about their appetite for risk.
|
| The more significant difference I have observed, especially over
| the last 25 years, is that west coast investors are more afraid
| of missing out on upside, while investors elsewhere (US east
| coast, Europe, much of SE Asia except some chinese funds) are
| more worried about the downside. This makes the west coast more
| dynamic (more eagerness for a deal, more willingness to get into
| a deal with less onerous terms or lower percentage) than
| elsewhere. Also I've found east coast investors far more
| transactional. These are gross generalizations (I can easily
| point to exceptions to my own statement) but are generally true
| in my experience.
|
| Edit: It's missing out on upside that looks like "sheep"
| reaction. Someone may have a good idea for a product and identify
| an underserved market. You may like that sector but perhaps you
| don't like the team, or you can't get into the deal but you can
| get into a deal with someone else who has a different way to
| address the sector. That isn't necessarily a "fashion" issue
| (though sadly it sometimes is). Look at it in retrospect: there
| weren't integrated circuit startups in 1950 but there were a a
| few in the 50s and very many in the 70s. Would anyone today
| consider that "sheep" behavior?
|
| BTW I have no desire to defend the VC industry, but these are
| what I see.
| dogleash wrote:
| I'm not sure what your point is, other that agreeing with the
| article author that VC's appetite for risk is generally lower
| than what the brand image of would imply.
| gumby wrote:
| I'm glad you commented as that is precisely _not_ what I was
| trying to say, so i 'm sorry I wasn't clear.
|
| (OK, actually I did agree with the article in regards to
| points outside California.)
|
| But I was trying to make two points where I thought the post
| was not correct:
|
| 1 - The "don't want to miss out on upside"-motivated crowd
| take a lot of risk, sometimes on stuff even I think is
| absurd...and some of those bets that seem stupid to me do pay
| out.
|
| 2 - There's nuance in what appears to be "herding" behavior
| so that the "sheep" complaint is...probably wrong.
|
| Again: my comments are supposed to be normative; the VC
| community neither needs nor deserves my support.
| hellcow wrote:
| I did some fundraising in CA, London and Berlin, and my
| experience mirrors yours. European investors seemingly wanted
| Facebook-sized exits of highly successful growth-oriented
| companies but nearly all offered really poor terms with high
| requirements. I specifically remember one German investor
| wanting me to show multiple years of profitability for a seed
| investment.
| traceroute66 wrote:
| You know, I prefer the EU/Asia risk-averse approach to
| startup funding.
|
| IHMO the problem to the US-style approach of (relatively)
| easy money is that for every good startup that comes out of
| it, you've got dozens or hundreds of at best "Me Too - but
| slightly different" companies (i.e. minimal competitive
| differentiators), and at worst snake oil companies doing
| everything possible to sell unsuspecting customers a product
| that is far far far too immature and with IT infrastructure
| burn rates that would make your local Fire Department wince.
|
| In the US if you're good salesman who can tell a good story
| then you're probably 2/3 of the way there towards getting
| some funding, there's just so much money sloshing around the
| system and so much FOMO.
| gumby wrote:
| > You know, I prefer the EU/Asia risk-averse approach to
| startup funding...the problem to the US-style approach
|
| Just to be clear, one aspect of my (GGP) comment was that
| it's really a California-plus-a-bit-of-China approach
| that's FOMO -- my experience in doing deals in BOS and NYC
| is about as bad as in EU.
|
| And for all that I say about California being FOMO: note
| that Theranos and WeWork were not SV funded (Theranos's
| sole valley investor was the father of the founder's
| childhood friends). We work's funding was primarily outside
| the US.
| yowlingcat wrote:
| Do you live in EU/Asia or do you live in the US?
| xiphias2 wrote:
| EU as a whole is sadly too risk averse and going downhill
| because of it. While quality of life is still great there,
| the GDP share of EU is falling.
|
| I believe the main reason is that people in EU in general
| prefer to invest in bonds instead of businesses / stocks even
| for long term (where stocks make more sense), but government
| bonds themselves can't move the world forward.
| johnqian wrote:
| Another trite complaint about startups not being cool enough
| these days. There are plenty of interesting and well funded
| startups if you earnestly look for them. As for the majority that
| aren't interesting to you, well, they don't owe you
| entertainment.
|
| The Utopia you describe seems to be "VCs give me unlimited money
| but I'm not expected to provide them any returns or listen to
| their suggestions, ever". I don't know what to say to that. It
| sounds like what you really want is to be rich, so you can
| finance your own experiments.
|
| Like others have said, this blog post would be much more
| interesting if you described what experiments you'd run if you
| had money. I think about that myself very often.
| crawfordcomeaux wrote:
| This is clearly something written many people will have
| difficulty connecting with.
|
| I'm guessing it's easier for me because I've yet to see a startup
| out to prove the existence of human needs for thriving and
| committing to designing a business and culture with that level of
| awareness, or with the goal of creating an ecosystem capable of
| meeting all those needs.
|
| And if startups and their VCs are all chasing something else
| besides the needs to thrive, then aren't they all sheep going
| after not-needs?
|
| Where's the startup that's like "Human needs? Establishing what
| those are was the first thing we did when we had this idea
| because product-market fit is meaningless if we're literally
| developing a system that denies the existence of needs of the
| people working here by staying ignorant of them. That's
| organizationally and societally suicidal."
| crawfordcomeaux wrote:
| Terrible things I'd do with that money:
|
| Fund the Sun Ra Arkestra to keep innovating jazz without
| catering to whiteness.
|
| Fund systems for giving to everyone's needs, hopefully
| undermining capitalism.
|
| Create a new currency by defacing old currencies with messages
| of gratitude and revolution.
| Scotrix wrote:
| Amen!
| e-dant wrote:
| My whole heart agrees.
|
| I've often chalked this up to founders following the money. If
| everything is secondary to that -- if it's not for the love of
| software -- you become bedfellows with technical debt and flashy
| bloatware.
|
| But you have something to write your investors about.
|
| Being antithetical to bloat, I see real innovation in FOSS.
| JJMcJ wrote:
| > Risk taking in the workplace
|
| You mean like this bold approach to development?
|
| Programmer: "Please, boss, let me write this one in Rust."
|
| Manager: "OK, but if you are even one day late, you job will be
| on the line."
|
| Programmer: "Never mind, I'll use Java." Knowing that if three
| months late using Java, nobody will care.
| Havoc wrote:
| Little bit odd simultaneously lamenting the dearth of new ideas
| and complaining that people are doing the same thing over & over.
|
| If it was that easy to come up with unique new viable ideas VCs
| would be investing in that. But its hard. Has little to do with
| risk tolerance.
| jrm4 wrote:
| At the risk of oversimplifying, isn't this all just fundamentally
| a "skin-in-the-game" problem?
|
| Which is to say, external investment perhaps makes sense when
| there's necessarily going to deep sunk costs (which correspond to
| capital like chunks of land, huge amounts of labor, piles of raw
| materials) etc.
|
| But in the internet age, nah -- which is, your big money
| companies frequently don't really NEED all this money. So what
| this really is is just a weird form of risk-play(could be either
| "gambling" or "insurance" depending on how you look at it) for
| the rich -- which creates seriously bad incentives; return at all
| costs?
| bduerst wrote:
| VCs are more like lemmings.
|
| They're beholden to funders who, while wanting to see ROI, also
| want to make sure they're not missing the next big thing.
|
| This FOMO competition means VCs are more likely to jump of a
| cliff once that first VC makes the leap, because in the off ~1%
| chance it's a big thing, the VC can't afford to miss it.
| cortesoft wrote:
| Isn't this what separates work from play?
|
| Work is what you do in order to gain the resources necessary to
| play. Work is about using your energy/time to produce something
| that is more valuable to someone else than the value of the
| energy/time was to you. Play is about using yiur energy/time for
| what you want.
|
| The person who grew the food that you eat also would love to do
| things that are more fun than farming, why did you make them farm
| to get your money instead of paying them to create art? If you
| aren't willing to pay the farmer to do whatever they want, why
| would you expect someone else to pay you to do whatever you want?
|
| If you want someone else to give you stuff/money that you want,
| you have to give them something they want in return.
| charles_f wrote:
| It's easy to claim people don't take enough risks when it's not
| your money. VCs are not gambling agencies, nor "foster"
| innovation, they're here to maximize investment.
| [deleted]
| roopawl wrote:
| If this article were right, Google X would have transformed our
| daily lives in so many ways by now
| egypturnash wrote:
| _It 's where I'd rent servers to compute seemingly useless shit -
| where I'd blow tons of carbon dioxide into the atmosphere just to
| gather more, to you, irrelevant information._
|
| Wrap this up in some waffle about cryptocurrency and you'll have
| people falling over themselves to give you money.
| SkyMarshal wrote:
| This blog post started out good, but fizzled at the end. I was
| expecting to hear actual examples of the terrible things he'd do
| with our money, but alas no specifics.
| ghostbrainalpha wrote:
| That does sound like a more interesting article. Let's seed
| some ideas here.
|
| I'd like to pay employees $5 each time they high five each
| other. With no limits really on the amount of high fives they
| can do. We could use smart trackers on wristbands to count the
| high fives. Become the highest hive five density office place
| in the world.
|
| See if we can really prove or disprove all these studies about
| high fives and the culture of performance.
| https://www.helloteam.com/did-you-know-high-fives-are-proven...
| SkyMarshal wrote:
| Haha, that reminds me of the AI Paperclip maximizer problem,
| just applied to humans instead.
| agentwiggles wrote:
| Eventually, the AI develops a race of barely sentient
| humanoids with 10s of limbs whose only source of pleasure
| in life is smacking their hands together.
| disintegore wrote:
| I can think of three scenarios in which "risk taking" occurs :
|
| First wherever wealth is accumulated in such excremental
| proportions that risk itself is no longer (as much of) a factor
| (eg FAANG-tier companies, ultrarich investors)
|
| Second wherever the need for/value of solutions is judged too
| high for their development to be contingent on the existence of a
| viable business model (eg public sector, academia)
|
| Third wherever normally risk-averse people misjudge the risks
|
| It's hard to think of anything else in this mode of production.
| Innovation is stymied by the threat of precarity, which looms
| over the vast majority of people. The others must operate either
| on prudence and sheer volume, or "luck"
| mywittyname wrote:
| > it also shows the level of risk aversion they exhibit.
|
| I feel like it's very risky to do what everyone else is doing in
| a winner-take-all market.
|
| It seems like part of the problem is that there's too much VC
| money floating around for the number of opportunities in the
| market. I'm sure most investors would love an original pitch, but
| they just aren't getting any. And how can you claim to be a VC if
| you're passing on every venture looking for your capital?
| Throwing $1MM at Twitter for Dogs is probably just a cost of
| doing business, it keeps you in the loop and adds some prestige.
| JumpCrisscross wrote:
| > _it 's very risky to do what everyone else is doing in a
| winner-take-all market_
|
| There's an inflection point before which even the losers will
| get a decent return and after which the company must utterly
| dominate for the valuation to make sense. Consolidation doesn't
| come free for the winner.
| JumpCrisscross wrote:
| VCs aren't the risk capital anymore. They're riskier than _e.g._
| the S &P 500. But I'd bet the average distressed-debt hedge fund
| has more variance than the top tier VC funds.
|
| The venture (versus scaling) risk is taken by angels and seed
| investors. A majority of _their_ bets totally fail. Not a down
| round or bad IPO or acquihire. Totally bust. Zero dollars back.
|
| We have multiple bets in space colonization, genomics, fusion and
| direct neural interfacing in play in America. I'd be cautious
| before calling the entire space risk averse. If all you're
| hearing about is crypto, FAANG and grocery delivery, you may want
| to broaden your professional circle.
| fhrow4484 wrote:
| Is there some humor attempt lost in translation here?
|
| The first part seems to accurately describe the sad state of
| affairs regarding European VCs that are too risk averse, and, in
| this particular example of deliveries-by-bike, unoriginal.
|
| But the last part about the Utopia seems like 100% sarcasm?
| [deleted]
| throwaway98797 wrote:
| risk is on a sliding scale
|
| don't lament what the world is, but what you want the world to be
| h2odragon wrote:
| > dream of not owing responsibility to my employers or
| financiers. The utopia of creative freedom, where no budget
| limitations, no sense of scarcity, or fear of failure exists.
|
| When you have no budget, you have no budget limitations.
|
| Alternately stated: Be your only investor.
|
| Or, as has been said before me: "Do as thou will"
| xsmasher wrote:
| From that c64 article yesterday -
|
| > The cost of developing the Commodore 64: No one knows. "I had
| no formal budget accountability," said Winterble, "other than
| Jack [Tramiel] watching me. Jack said that budgets were a
| license to steal."
| 21723 wrote:
| Virtually no one actually likes risk (pathological gamblers are
| an exception, but they are understandably rare in the white-
| collar world). By "risk" I don't mean variance (or, equivalently,
| standard deviation) and I don't mean small bets with limited
| consequences. I'm talking about real risks that threaten one's
| career, reputation, and livelihood. No one fucking wants those;
| most people in business would end a human life (though few would
| admit it) to remove one from their existence.
|
| So, here's why "risk" is so weird and problematic. VCs will take
| numerical risks (standard deviation) because it is their job,
| just as some traders will gamble $10M on a 51/49 trade and not
| feel terribly bad if it goes against them. Almost _no one_ is
| willing to take a real life-altering risk... and, to be honest, I
| don 't blame them. This is especially true of employees, who are
| incentivized to be as risk averse as possible: if things go bad,
| they get fired; if things go well, their bosses profit.
|
| It would be better if we could just admit this and accept it and
| basically agree that no one should be expected, as a matter of
| daily living, to put their well-being at risk. Income is a
| utility; you don't want it turned off. Furthermore, when people
| are in precarious circumstances, society ought to do what it can
| to fix that.
|
| Thing is, the rich profit by our culture's lionization of "risk
| takers", while ignoring the fact that most of the people who hit
| it big took no real risks to get there. Sure, they could have
| lost $10,000 of their millionaire daddy's money, or had to call
| "weird Uncle John" to ask for a VP-level position in a consulting
| firm, but they weren't taking the _real_ risks that most of us
| have to take in daily life and get a lot less for. This nonsense
| prevents us from agreeing that, most often, true risk is a pretty
| bad thing that we have good reasons not to want in our lives.
| Juliate wrote:
| It reads like double-sarcasm and is hard to understand (much like
| double-negative).
| breaker-kind wrote:
| I'm not sure I see the virtue in ending an article with a
| declaration of wanting to commit untold damage to the environment
| for the sake of personal scientific experimentation
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