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It's also a very strange anecdote since the NYT articles primary point is that A16Z are pushing up valuations so deals like the one Peter Thiel made are no long
by gozo 11y ago
It's also a very strange anecdote since the NYT articles primary point is that A16Z are pushing up valuations so deals like the one Peter Thiel made are no longer possible.
Quoted in this blog post from the NYT article: "It’s easier to triple or quadruple your money when you’ve invested $10 million in a $100 million company than when you’ve invested nearly $100 million in a $1 billion company [...]"
Peter Thiel invested $500,000 for 10.2% i.e. in a $5 million company.
Unless there's something I'm missing here?
- austenallred 11y agoThe point is that A16Z is paying high prices (and you correctly note that everyone is). Tan's point is that there are still power laws at play, and that choosing one random investment to disprove portfolio theory is incongruent.
- chetanahuja 11y ago"Tan's point is that there are still power laws at play, choosing one random investment to disprove portfolio theory is incongruent." Except that he made no such point and just countered the anecdote with his own anecdotes. The original NYT article comes across as a well-researched, sensible piece of writing compared to this lazy, ill thought out blogpost.
- austenallred 11y ago> Multi-billion dollar companies happen when non-obvious ideas and huge market needs meet perfect execution. We've seen it before our eyes — Uber, Airbnb, Dropbox, Stripe, Instacart — and when you have the potential for 100X to 4000X returns, it's not about avoiding loss or minimizing downside. A proper venture portfolio is not like your 401K. The only way startup investors truly lose is if they miss the Uber.