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What I don't get, economically speaking, is how we can both be in a bubble and in a barely recovering economy. In other words, how do these angels and VCs still
by yannickmahe 16y ago
What I don't get, economically speaking, is how we can both be in a bubble and in a barely recovering economy. In other words, how do these angels and VCs still have that much money to invest in such companies?
- futuremint 16y agoMost VC's are backed by enormous pension funds and/or other group retirement vehicles. This is how they can afford to bet large sums of money on multiple companies with an expected payoff of only 1 in 10 companies on long time frames. The pension isn't using that money (right now anyway), so the VC is free to do with it what they want, and in the end the money comes back to the pension in multiples. At least this is my understanding talking to an actual VC (not in a fund-raising situation, just casually).
- tyng 16y agoEver heard of the term "two-speed economy"? It's happening right now on a much larger scale in Australia.
- jacques_chester 16y agoIndeed. Today in The Australian there was a story about laundry hands on offshore rigs being paid ~$420k. http://www.theaustralian.com.au/national-affairs/laundry-staff-on-420k-a-year/story-fn59niix-1226027697866 http://www.theaustralian.com.au/national-affairs/laundry-sta...
- adaml_623 16y agoPay attention and you'll see that the rich have been getting richer even with the recession. They need investment opportunites and investing in real estate probably isn't popular. Hence angel funds have tons of money to throw around.