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After 10 Years, Nathan Myhrvold's $3B of Private Equity Funds Show Big Losses
- partycoder 8y agoNathan Myhrvold had enough money to retire, but instead he decided to start a trolling business. I imagine what would it be like to wake up every morning, look at yourself in the mirror and say "Today I am going to troll people with patents". I would feel probably more satisfaction living in the streets than making money (in theory, since he is apparently losing money) trolling people.
- vernie 8y agoBeing so up-your-own-ass about cooking is expensive.
- paulsutter 8y agoTitle might read "Nathan Myhrvold's Patent Troll Funds Show Big Losses" > They were designed to invest in patents and innovations, not companies or their securities, over a lifespan of 20 years, as opposed to the usual 10 to 13 years. Halfway through their run, the funds are deep in the red...Invention Investment Fund II was the bigger fund that Myhrvold’s firm, Intellectual Ventures, raised in 2008
- jacquesm 8y agoGood. The Sooner Intellectual Vultures dies a terrible death the better. Myhrvoid is an excellent example of someone I can't make my mind up about. Child prodigy, absolutely a genius but the whole patent story is just plain disgusting.
- maxxxxx 8y agoI am glad that his funds are not doing well. But Myhrvold is an example of people who can have a lot of qualities we support but then also have a lot of qualities we don't support. People like to categorize people into all good or all bad but a lot of people have both in them.
- jacquesm 8y agoSure, but it's pretty rare that someone is at both extremes of like and dislike at the same time. Obviously speaking for myself here, everybody calibrates their likes and dislikes in different ways.
- maxxxxx 8y agoI would think Bill Gates is a good example. Super competitive and often destructive businessman and then suddenly turning into a philanthropist. Or Andrew Carnegie and John d. Rockefeller. It's hard to have a conclusive opinion about them because their good and their bad sides both are extreme.
- PhantomGremlin 8y agoSteve Jobs is another example. Many things about him to admire; many things about his behavior to despise. Even Mother Teresa wasn't perfect: https://en.wikipedia.org/wiki/Mother_Teresa#Criticism https://en.wikipedia.org/wiki/Mother_Teresa#Criticism
- Arnt 8y agoI've heard worse than that about her... "Didn't treat" extended to telling parents of mentally handicapped children to stop bothering. A physician at a charity in Kolkata told me: "We'd persuade the parents to include the children in daily life, speak to them, give them sensory input, then Mother Teresa's crew would come and tell the parents to just stop bothering, to just feed them and otherwise leave them in a corner, and when the parents did that, the children would return to vegetating."
- majos 8y agoI think the evidence for Bill Gates as a force for good is strong. Sure Microsoft attained and maintained its dominance in unethical and maybe illegal ways. But I am not aware of much destruction beyond preventing other software companies from similar success. I would much rather all those billions be concentrated with Gates, whose foundation is really doing things, than scattered among a dozen software companies and supporting generic medium-wealthy lifestyles with respectable 5% of income given to charity.
- sixQuarks 8y agoHe's undoubtedly a genius, but I see him as a greedy asshole. He's the author of Modernist Cuisine, a cookbook based on science. He has done all the experiments to determine the scientifically best ways to cook things. Instead of making it an affordable book, he priced it at over $600. yes, he spent millions in the process, but he's a multi-billionaire. He's never going to recoup the $25 million he spent on research, why couldn't he have done that as giving back to the community? I just don't get that.
- deleted 8y ago[deleted]
- oh_sigh 8y agoBecause he wants the book to be a conversation piece for fanatics - if you price it at $30 it will be the 'joy of cooking' - which is fine, but isn't what he is going for
- noonespecial 8y agoOh, he's a greedy asshole alright, but the choice to sell the book for $600 wasn't an example of it. He had a choice to make on the book, commodity cookbook or status symbol. With all the hype around it, that book was destined to be a PDF on the pirate bay the day after release no matter what the price. Selling it for $600 so rich half-wits could perch it in their kitchen as a trophy was brilliant. Now IV and its business model was pure, reactor-grade greedy assholery. Perhaps that's how he understood so well the mentality of the person who would drop $600 for a cookbook. With the taking one to know one and all that...
- archagon 8y agoIn fairness, it's a bloody gorgeous book. (Or rather, set of books—I believe there are six.)
- lgf 8y ago>He's the author of Modernist Cuisine, a cookbook based on science. He has done all the experiments to determine the scientifically best ways to cook things. Instead of making it an affordable book, he priced it at over $600. $600 is not that extreme a price in the 'technical food book aimed at professionals' realm (which is where the book was originally aimed). There are 4-volume references like Hui and Sherkat's "Handbook of Food Science, Technology, and Engineering" which retail at $1,800 (https://www.amazon.com/Handbook-Food-Science-Technology-Engineering/dp/0849398479); https://www.amazon.com/Handbook-Food-Science-Technology-Engi... a number of single-volume Wiley handbooks have prices around $290. Factoring in that Modernist Cuisine is 23kg, 7 volumes, had an initial print run at 6,000 copies and an unusual volume (the kitchen manual is printed on plastic)...it's hard to see how this is a reasonable criticism, especially when Modernist Cuisine at Home (which is targeted at a wider audience and covers many of the same bases) is priced at $112.
- taway20180523 8y agoPatent trolls have two revenue streams: 1. royalties from small businesses 2. judgments against large businesses They survive on #1 and make return on #2. It is a good way to turn $1M into $100M. It doesn't work if you start with $3B.
- greglindahl 8y agoYeah, turns out that there is a maximum amount of money that you can put to work in that "industry", and it's a lot less than $3B.
- weliketocode 8y agoHindsight is 20/20, though. At the time he raised the fund, there certainly were plenty of people who thought patent trolling could scale.
- greglindahl 8y agoYes. They also had other ideas, of a patent marketplace, that failed to actually happen. And directly inventing stuff, which also failed and always looked like PR rather than a serious business.
- benlower 8y agoFuck Nathan Myhrvold and Intellectual Vultures.
- bhouston 8y agoGood. I hope high profile failures of patent troll funds convince others to not follow in their footsteps. It also ruined Nathan's reputation.
- NelsonMinar 8y agoSince no one has said it directly; this article is about Intellectual Ventures, the patent troll firm that aggressively weaponized America's poorly written intellectual property law. http://www.intellectualventures.com/ http://www.intellectualventures.com/
- pg_bot 8y agoI'm fairly certain that the decision in Alice Corp v CLS Bank International put the nail in the coffin of Intellectual Ventures' business model. A large percentage of the patents in their portfolio[0] are of the abstract idea implemented on a computer variety. Since patents have a shelf life most of what they purchased will likely expire returning 0% on investment. This doesn't mean that patent trolling as a business is dead, but it certainly looks like it is not scalable which is frankly wonderful news. [0]: http://patents.intven.com/finder http://patents.intven.com/finder
- jasonmp85 8y agoGood.
- vermontdevil 8y agoThis is ridiculous: Intellectual Ventures has always maintained that “traditional accounting rules don’t accurately reflect the value of our patent portfolio.” Hate when companies not doing well try to dodge by blasting "traditional accounting rules" when these rules have been crafted over the years to accurately reflect the value of said company. Bottom line - the returns for both funds are in the negative. Can't avoid this by hoping for some 'modernist' version of accountancy that might make the fund look good.
- weliketocode 8y agoAbsolutely. I think accounting rules often cause divergences from reality, but this is 10 years in and this fund has had AWFUL performance.
- ikeboy 8y agoBuffet complained about them recently too, do you think Berkshire's latest report accurately reflects their value?
- ChuckMcM 8y agoAnd yet it is kind of true. Consider that patents in their portfolio are exactly equivalent to unexpended ordinance, ready to go when the opportunity presents itself. How do you value that? A patent my go its whole life and never be infringed, or it might turn into a $500M payday from an Apple or a Microsoft.
- gwern 8y agoBut they have 95k patents and have done or backed scores of lawsuits with their $3b of capital. Surely that's enough! Y Combinator didn't need $3b to show good results despite regular VC having similar long-tail or hit-driven results.
- ChuckMcM 8y agoAll true, but how do you put an asset value on a particular patent? So if you've got a $100M fund and it spends $50M on acquiring patents and then the other $50M on prosecuting them as it can, it isn't possible to predict if one of the patents will be a gold mine or a dud. I think the closest thing I can imagine that would be like this would be mineral rights contracts. You spend $50M on mineral rights contracts on some amount of land and the rest on trying to develop useful resources out of those plots. If one has some easy to reach dense and salable minerals it pays for the others. But a plot that hasn't been geologically surveyed? What is it worth?
- Ice_cream_suit 8y ago"In total Myhrvold’s firm has acquired 95,000 patents and launched or been behind dozens of lawsuits, making it a giant patent troll. But Intellectual Ventures’ litigation strategy has been dealt some setbacks. The nation’s top patent court has thrown out patents Intellectual Ventures has tried to assert against companies like Capital One. This week a federal appeals court issued a ruling that will make it very difficult for Intellectual Ventures to assert a patent it had sued Ericsson for infringing."
- greglindahl 8y agoMyhrvold hasn't been as successful as Perfect 10 at establishing useful precedents, but he's not far behind.
- snak3s 8y agoIce_cream_suit 6 days ago | parent [-] | on: Microsoft Is Said to Have Agreed to Acquire GitHub Time to move to Gitlab... reply Ice_cream_suit 6 days ago | parent [-] | on: After 10 Years, Nathan Myhrvold's $3B of Private E... "In total Myhrvold’s firm has acquired 95,000 patents and launched or been behind dozens of lawsuits, making it a giant patent troll. But Intellectual Ventures’ litigation strategy has been dealt some setbacks. The nation’s top patent court has thrown out patents Intellectual Ventures has tried to assert against companies like Capital One. This week a federal appeals court issued a ruling that will make it very difficult for Intellectual Ventures to assert a patent it had sued Ericsson for infringing." reply greglindahl 6 days ago [-] Myhrvold hasn't been as successful as Perfect 10 at establishing useful precedents, but he's not far behind. reply Ice_cream_suit 14 days ago | parent [-] | on: As Google Feeds Cats, Owl Lovers Cry Foul Humans kill 58 billion animals each year. I do not see anyone suggesting that we stop feeding humans. strstr 14 days ago [-] Feral cats aren't people? blarg1 14 days ago [-] or are they ... briandear 14 days ago [-] Humans are more important than feral cats. joejerryronnie 14 days ago [-] That could be debatable. Ice_cream_suit 15 days ago | parent [-] | on: Has there been progress in philosophy? Has there been progress in art? danieltillett 15 days ago [-] Interesting question. No if you mean aesthetics, yes if you mean techniques. Ice_cream_suit 16 days ago | parent [-] | on: Andy Rubin Puts Essential Up for Sale, Cancels Nex... Wonder if this has anything to do with it: "Former Android Head Left Due To Sexual Misconduct Claims" https://www.channelnews.com.au/former-android-head-left-due-.. https://www.channelnews.com.au/former-android-head-left-due-.... "The woman who filed the complaint reportedly worked in the Android division run by Rubin, which would make any personal relationship between the two violate Google policy; the company requires employees to disclose such relationships so that one of them can be moved to another division. Rubin left the Android department in March 2013 to lead Google’s efforts in robotics, but the HR investigation is said to have taken place in 2014. That investigation, according to The Information, concluded that “Rubin’s behavior was improper and showed bad judgement.”" https://www.theverge.com/2017/11/29/16714264/andy-rubin-leav.. https://www.theverge.com/2017/11/29/16714264/andy-rubin-leav.... Ice_cream_suit 21 days ago | parent [-] | on: A Very Sad Goodbye – OSSIC X: The first 3D audio h... Class action litigation is starting. See the comments on the page for more information. Ice_cream_suit 21 days ago | parent [-] | on: Why a Dutch court stopped high school students fro... "Almost 70 percent of schools in the Netherlands are administered by private school boards, and all schools are government funded equally. The instrumental variables results show that private school attendance is associated with higher test scores. Private school size effects in math, reading and science achievement are 0.19, 0.31 and 0.21" http://documents.worldbank.org/curated/en/705501468323653171.. http://documents.worldbank.org/curated/en/705501468323653171.... Ice_cream_suit 21 days ago | parent [-] | on: Why a Dutch court stopped high school students fro... Like in most countries, it is probably linked to social class. I studied at a private school in Amsterdam when I lived in the Netherlands in the 70's. Most of my parents professional colleagues sent their children to private schools too. The reasons included quality of education, availability of certain subjects and the relative lack of troubled and disruptive students. A relative recently married a Dutch man from near Rotterdam. He and his siblings went to private schools. I recall nearby state run schools were pretty dismal. Perhaps things have changed. Ice_cream_suit 36 days ago | parent [-] | on: Please Stop Using Adblock (But Not Why You Think) Does anyone still use Adblock ? Thought that most people jumped ship to Ublock Origin years ago. Ice_cream_suit 58 days ago | parent [-] | on: Last satellite in the Indian Regional Navigation S... I assume that you are ok with having your country taken over by ( insert random country ) ? I must say that US gun policy would improve for the better if China was running them. More Guidelines | FAQ | Support | API | Security | Lists | Bookmarklet | Legal | Apply to YC | Contact Search:
- weliketocode 8y agoI'd love to know what the goal with Intellectual Ventures actually was. Did Myhrvold really think he was going to be bring liquidity and transparency to the patent market? Or was the intention really to be a giant patent troll?
- jmull 8y agoI think you can judge intentions based on what IV actually attempted to do with their resources.
- imranq 8y agoPersonally I think Myvhold’s company is not as evil as people say. It actually makes a lot of sense if you take a long term view. The goal is to create a market for innovation and decentralize DARPA-like institutions so that market forces can create a sustainable source of innovation.
- buttcoinslol 8y agoNathan, this is a bit transparent...
- dang 8y agoPlease don't do this here.
- sitkack 8y agoMyhrvold had a chance to build something wonderful to do good in the world. Hopefully he still does and takes it.
- beedogs 8y agoGood riddance to an awful business model. Hopefully he'll disappear and never be heard from again.
- sunstone 8y agoIt's instructive to consider Mr. Myhrvold and Mr. Musk over the past 10 years. One decided to tackle hard problems because they were important for the future of all mankind. The other decided to take advantage of what seemed like a slam dunk legal anomaly in order to get rich quick at the expense of actually productive people. It's nice to see that poetic just sometimes has its way.