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This was my first notion too, but I think if you look more closely as Suster's arguments, he is really pointing out disparity between 2 forces: 1. The short-ter
by jonmc12 15y ago
This was my first notion too, but I think if you look more closely as Suster's arguments, he is really pointing out disparity between 2 forces:
1. The short-term economy (including stock markets, jobs, growth and politics)
2. The long-term (10-yr) tech investment opportunity
So, he is saying "we know the returns are there over 10 years, but we've got to survive in the meantime". Equity markets aside, the fundamentals of business are effected by the short-term economy.
I kept wondering too, is this true for private investment (ie, angels)? Are they susceptible to the same short-term concerns? Or will Angels keep pumping money into early stage independent of the economic conditions? Perhaps this post is doing nothing more than pointing out the obsolescence of the VC model through uncertain economic conditions..
- anamax 15y ago> I kept wondering too, is this true for private investment (ie, angels)? Are they susceptible to the same short-term concerns? Or will Angels keep pumping money into early stage independent of the economic conditions? Economic conditions have a huge effect on the number of angels. For example, the dot-bomb killed a lot of angels. So did the 2008 crash. The run-up this year created some.
- mapgrep 15y agoIt's definitely possible that the "fundamentals of business are effected by the short-term economy." Good point. I just didn't see that point being established in the VC post, at least not well. It seemed much more focused on opportunities in equities. Maybe I need to read it more closely. It just seems to me that if you a product that can produce the sort of returns VCs are interested in, it should be valuable enough to customers that it could do well in virtually any macroeconomy. Google, for example, launched its cash cow AdWords just after the first dot-com meltdown.