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Of course hard work matters, but when VC tells you to work hard, take it with the grain of salt, because this is how VC is going to make money off your work. Wh
by vl 5y ago
Of course hard work matters, but when VC tells you to work hard, take it with the grain of salt, because this is how VC is going to make money off your work. What is missing from this advice is what is sacrificed. If and when 10-20 year later you cash out, what else are you going to have beside money? Family, friends, health? If you can make this trade-off consciously - good for you, but most people just go with the flow and don't think about it until it's too late.
Double irony of this advice is that many VCs are one of the most laid-back people you can meet. Usually they are already rich, so they don't exactly have to hussle anymore, and can choose when to do so.
- growup12345 5y agoYou are waisting your breath trying to convince the fanboys here. Their brain cannot grasp the concept that the VC just wants to make money. To the VC, investing in a startup is equivalent to buying a very out of the money call option. Option theory tells us these are ultra low premium but have immensive upside, so the payoff for the VC is ultra convex and non linear: from 1000 startups, 10 get more than 10 mil valuation, and maybe 1 is a unicorn (i’m making the numbers up but u get the idea). So yes Mr Graham would love for all of the fanboys to work hard since they are literally just options to him, and he has nothing to lose apart from small options. On the flip side, startup owners are then underwriting options in the form of their life and work, so must be short volatility. Long story short: dont do startups thinking you will win, think the VC will win