Even the best business plan with the most competent people behind it is a wild gamble filled with idiosyncratic risk and its success or failure will hinge on a

Even the best business plan with the most competent people behind it is a wild gamble filled with idiosyncratic risk and its success or failure will hinge on a substantial amount of luck. If professional hedge funds can't consistently beat a passive index fund, what makes VCs and bankers special? Steps to being a VC: 1. Have lots of money 2. Establish procedures that filter out the obvious losers, increasing odds of success from 1 in a million to maybe 1 in a thousand. 3. Leverage said money and procedures such that you statistically make money on that 1 in a thousand. It's the same way someone with infinite money can keep going back to the Casino until they hit the jackpot (assuming no house limits, this is why house limits exist actually), or buy up all the lottery tickets until they find the winning ticket. So anyone who privately funds businesses out of their own pocket is gambling, but they can't be removed because where else is the funding going to come from? Maybe you can crowd source if you have really good marketing and a popular idea. Beyond that nothing really exists on the scale of what VCs offer. If you hypothetically created a government office with a large enough budget to replicate the various VCs, perhaps it would be slightly more fair in terms of who gets access, but it would just be bureaucrats doing the gambling with taxpayer dollars instead of private entities out of their own budget, which wouldn't necessarily be any better if you look at the current state of government contracting/grants. So sadly, their money and willingness to gamble is largely their use and why they're entitled to profits. The system isn't fair and it rewards the lucky more than the deserving, but without said system a lot of cool, revolutionary stuff would never have happened. Even SpaceX and Tesla are indirect effects of the success of Paypal, which was initially funded by Peter Thiel.