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A bubble company like this is an event of staggering inefficiency, it sends huge amounts of very valuable resources (money, but also things like people's career

by CPLX 11y ago

A bubble company like this is an event of staggering inefficiency, it sends huge amounts of very valuable resources (money, but also things like people's careers, creativity, press attention) into a situation where they are ultimately squandered. Asset bubbles can be like wars, they can waste the promise of an entire generation, never to be recovered. Nobody wants to see a collapse for collapse's sake, but there is quite a bit of social good in avoiding or deflating an asset bubble, be it in residential mortgages, late stage technology companies, or a 20 year old college student who was allowed to lose tens of millions of dollars of people's pension money just because she happened to be born in the right neighborhood.

fossuser 11y ago
Not unreasonable, but Clinkle and Color were both huge wastes of money and so far were more legitimately worthless than Theranos has been shown to be. The reaction seems more negative than I would expect with the information currently available - it's like the community wants to see them fail. Maybe they are being unethical or it will turn out they don't actually have a real product, but it seems kind of early to lay on the kind of hostility people have been. A small part of me wonders if it's because there's a female founder.
- CPLX 11y ago
  1) Clinkle and Color are the butt of many many recurring jokes and a perennial punchline for people in startup land. 2) Neither of those companies had anything even a little bit close to a ten year run and a $9bn valuation. It's one maybe two entire orders of magnitude bigger as a flame out.
ageofwant 11y ago
I certainly don't disagree with your analysis, but surely most of the blame should be placed on the shoulders of those that controlled the pension money ?
- CPLX 11y ago
  We, rightly, have a concept of "fiduciary duty" deeply embedded in our common law and in the practice of investing. That applies to all the people entrusted with the assets in question, from the pension fund manager to the VC firm to the firm receiving the investment. There's a difference between a bad or risky bet that doesn't pan out and violations of that duty like misrepresentation and self-dealing. The blame should go to those who breached that duty. It seems that at minimum they engaged in misleading statements about the degree of progress they had made with their technology. That's certainly unethical and possibly fraudulent.

by CPLX 11y ago

fossuser 11y ago

Not unreasonable, but Clinkle and Color were both huge wastes of money and so far were more legitimately worthless than Theranos has been shown to be. The reaction seems more negative than I would expect with the information currently available - it's like the community wants to see them fail. Maybe they are being unethical or it will turn out they don't actually have a real product, but it seems kind of early to lay on the kind of hostility people have been. A small part of me wonders if it's because there's a female founder.

CPLX 11y ago
1) Clinkle and Color are the butt of many many recurring jokes and a perennial punchline for people in startup land. 2) Neither of those companies had anything even a little bit close to a ten year run and a $9bn valuation. It's one maybe two entire orders of magnitude bigger as a flame out.

ageofwant 11y ago

I certainly don't disagree with your analysis, but surely most of the blame should be placed on the shoulders of those that controlled the pension money ?

CPLX 11y ago
We, rightly, have a concept of "fiduciary duty" deeply embedded in our common law and in the practice of investing. That applies to all the people entrusted with the assets in question, from the pension fund manager to the VC firm to the firm receiving the investment. There's a difference between a bad or risky bet that doesn't pan out and violations of that duty like misrepresentation and self-dealing. The blame should go to those who breached that duty. It seems that at minimum they engaged in misleading statements about the degree of progress they had made with their technology. That's certainly unethical and possibly fraudulent.