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> That's not a flaw, it's a fundamental part of how it is meant to work. And, as the article demonstrates, it is not without risk. A CEO spending huge amounts
by untog 8y ago
> That's not a flaw, it's a fundamental part of how it is meant to work.
And, as the article demonstrates, it is not without risk. A CEO spending huge amounts of company money on other ventures he owns for no discernable reason is a pretty great example of why this SV model can be hugely problematic.
- dv_dt 8y agoIt can be problematic, but so can investors in SV companies demanding that scale-out takes off too early or too quickly. It's difficult to quantify which of many problems are a bigger issue, or even relevant from case to case.
- mistersquid 8y agoVocabulary question here: Is this "embezzlement"? I'm not sure because the use of funds were for legitimate services even if they are owned by James and his family. Is there a different word to describe the siphoning of company funds by directing business to self-affiliated parties? Is this covered by "nepotism"? (Thanks, in advance, for any clarifications.)