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I think it would be a good heuristic if you were able to be that precise about expenses, but I think most startups aren’t.
by shakezula 5y ago
I think it would be a good heuristic if you were able to be that precise about expenses, but I think most startups aren’t.
- paulgb 5y ago(Author here) I agree, but I think there is some applicability of the Kelly Criterion to startups (at least qualitativey) in explaining why an entrepreneur who is all-in on a company may be more inclined to take an exit than their investors, who have spread their bets.
- kqr 5y agoThe Kelly criterion is a U-shaped optimisation problem, so it is rather tolerant of imprecise estimations!