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Sorry, what??? I mean, you're entitled to do whatever you'd like. But do you see the potential valuations being tossed around? "Drew" is worth tens to hundreds

Sorry, what??? I mean, you're entitled to do whatever you'd like. But do you see the potential valuations being tossed around? "Drew" is worth tens to hundreds of millions. I just have no idea why someone would find it not only worth it to take money out of their own pocket to further a corporation that has no need for the empathy we would normally afford to people (or small businesses, which "round down" to individual people or small groups), but would actually see value in sharing this thought process with everyone else. It's not like using a "deal" is unethical or illegal (like, say, piracy), the company in question (or a reseller taking the hit) offered it. Is this some kind of silicon valley flavor of virtue signaling? If dropbox was a startup with 8 employees, especially one that didn't offer the near-commodity service (yes, I know UX etc matter here) that dropbox does, I would understand this. But that's so far from the case

anonytrary 9y ago
Predictably irrational people exist! However, how is this different than a $30 donation? I think the real question you want to ask is: Why do people donate money to people who already have lots of money?
- ironjunkie 9y ago
  As you state, this comment equals to: "I like Drew, so let me make a donation of 30$ to Dropbox" That's why I like economics so much. A lot of irrational behavior come simply from the fact that humans are usually terrible to understand the underlying economic transactions taking place. One of my favorite irrational behaviour is the one in which people value object they got more than the equivalent price in which they could buy//sell that object. For example: You have an old bottle of wine in your cellar, and it is now valued at 500$. A lot of people would simply put, never buy a 500$ bottle. But if that bottle was your possession, most of the people would keep it and eventually probably drink it, being completely irrational in regards with the 500$ valuation.
  - deleted 9y ago
    [deleted]
  - jmalicki 9y ago
    You also have to consider the level of effort it takes to sell the bottle to someone who isn't an experienced wine dealer, and the spread that likely exists between the buyer and seller. So even though it may be $500 to buy new, it's probably more like a $100 bottle if they sell it, so it's like getting an 80% off deal? Why not drink it?
    - totalZero 9y ago
      > the spread that likely exists between the buyer and seller. Spread doesn't have to favor a buyer.
      - jmalicki 9y ago
        No, it typically favors the middleman.
        totalZero 9y ago
        You have to think about it in terms of who demonstrates excess demand for the trade. If the buyer is more eager to transact, usually he ends up paying higher than fair value. The opposite is usually true if the seller is more eager for the transaction. If you have an item of unique value, you may aggressively sell it, as in your initial post to which I had replied. But if you just post a price -- take out a classified ad every week, for example -- then you can wait for an eager buyer to come along. Even the middleman often crosses the spread. A market-maker might have to clear out of excess risk/inventory ASAP, for example, which requires him to initiate transactions.
  - anonytrary 9y ago
    > One of my favorite irrational behaviour is the one in which people value object they got more than the equivalent price in which they could buy//sell that object. Art is also a good example. Art is globally unique, so what does it even mean for art to be worth $X? Seems like the only "value" of art is the price the next guy is willing to pay. The price is undefined until it's not. On the other hand, if I have a fake Van Gogh, I would not be emotional upon liquidating it because it is fungible; some computer and printer somewhere can easily reproduce the piece if I ever need it again. In addition, the price is well-defined because fakes have a well-defined manufacturing cost associated with them. An authentic Van Gogh has an infinite manufacturing cost as the guy is dead.
askins4trouble 9y ago
Pretty sure Drew is going to be worth upwards of $1 billion (25.3% stake at an $8-9 billion valuation minus any equity he has to give up to investors in the latest round) #TresCommas

anonytrary 9y ago

Predictably irrational people exist! However, how is this different than a $30 donation? I think the real question you want to ask is: Why do people donate money to people who already have lots of money?

ironjunkie 9y ago
As you state, this comment equals to: "I like Drew, so let me make a donation of 30$ to Dropbox" That's why I like economics so much. A lot of irrational behavior come simply from the fact that humans are usually terrible to understand the underlying economic transactions taking place. One of my favorite irrational behaviour is the one in which people value object they got more than the equivalent price in which they could buy//sell that object. For example: You have an old bottle of wine in your cellar, and it is now valued at 500$. A lot of people would simply put, never buy a 500$ bottle. But if that bottle was your possession, most of the people would keep it and eventually probably drink it, being completely irrational in regards with the 500$ valuation.
- deleted 9y ago
  [deleted]
- jmalicki 9y ago
  You also have to consider the level of effort it takes to sell the bottle to someone who isn't an experienced wine dealer, and the spread that likely exists between the buyer and seller. So even though it may be $500 to buy new, it's probably more like a $100 bottle if they sell it, so it's like getting an 80% off deal? Why not drink it?
  - totalZero 9y ago
    > the spread that likely exists between the buyer and seller. Spread doesn't have to favor a buyer.
    - jmalicki 9y ago
      No, it typically favors the middleman.
      - totalZero 9y ago
        You have to think about it in terms of who demonstrates excess demand for the trade. If the buyer is more eager to transact, usually he ends up paying higher than fair value. The opposite is usually true if the seller is more eager for the transaction. If you have an item of unique value, you may aggressively sell it, as in your initial post to which I had replied. But if you just post a price -- take out a classified ad every week, for example -- then you can wait for an eager buyer to come along. Even the middleman often crosses the spread. A market-maker might have to clear out of excess risk/inventory ASAP, for example, which requires him to initiate transactions.
- anonytrary 9y ago
  > One of my favorite irrational behaviour is the one in which people value object they got more than the equivalent price in which they could buy//sell that object. Art is also a good example. Art is globally unique, so what does it even mean for art to be worth $X? Seems like the only "value" of art is the price the next guy is willing to pay. The price is undefined until it's not. On the other hand, if I have a fake Van Gogh, I would not be emotional upon liquidating it because it is fungible; some computer and printer somewhere can easily reproduce the piece if I ever need it again. In addition, the price is well-defined because fakes have a well-defined manufacturing cost associated with them. An authentic Van Gogh has an infinite manufacturing cost as the guy is dead.

askins4trouble 9y ago

Pretty sure Drew is going to be worth upwards of $1 billion (25.3% stake at an $8-9 billion valuation minus any equity he has to give up to investors in the latest round) #TresCommas