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Isn't that the whole premise of VC funding though? Invest in a bunch of things, most of which will fail, but make that back from a big payout from the ones tha
by imron 11y ago
Isn't that the whole premise of VC funding though?
Invest in a bunch of things, most of which will fail, but make that back from a big payout from the ones that succeed.
- TheOtherHobbes 11y agoI'm not sure what the premise of VC funding is. But I'm baffled when VCs invest in businesses that don't have a business plan that demonstrates a reasonable likelihood of actual profit margins within a reasonable pay-off time, as opposed to steady losses of unknown and unstated duration. That's pretty much the definition of a failed business. So when everyone seems very surprised that businesses like this fail, it's even more surprising that they're surprised by it. I think there's a serious opportunity for VCs to fund workable but unspectacular non-unicorns with reasonable but not explosive growth potential. But maybe that's just not exciting enough, while hyper-growth is, even with no profitability. I can't pretend to understand it, because it makes no sense to me.