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DFJ put in $500,000. At their scale, that's chump change. They can safely invest that much money even in companies that are unlikely to succeed. And IIUC, Thera
by ameliaquining 6y ago
DFJ put in $500,000. At their scale, that's chump change. They can safely invest that much money even in companies that are unlikely to succeed. And IIUC, Theranos wasn't a fraud at that point—there was still genuine hope that their product would work.
pg, and others pushing back against the Theranos-as-an-indictment-of-Silicon-Valley-venture-capital narrative, are talking about the firms that invested much larger sums after Elizabeth Holmes had gotten a lot of good press and become a hot commodity (and, in most cases, after she'd started engaging in fraud, unbeknownst to most). Those firms lost their shirts in a way that DFJ didn't.
- hugs 6y agoPushing back on Theranos-as-an-indictment-of-Silicon-Valley-venture-capital is a fine point to make, but that's not the point he made. He said Theranos' cap table had an "absence of Silicon Valley firms", which is false. Also DFJ is not the only SV firm that invested. So did Larry Ellison in the $28.5M Series C. This is all very easy to find information. It seems like a weird point to nit-pick, but in most of PG's essays, there are so few demonstrably easy-to-disprove facts. This one is easy. And the misplaced hubris in thinking zero SV firms were foolish enough to invest in a fraud makes you question all his other assertions.