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VC backed startups are a Ponzi scheme? I believe all of the FAANG companies started that way (took VC funding in their early days.) How is anybody supposed to t

by eloff 4y ago

VC backed startups are a Ponzi scheme? I believe all of the FAANG companies started that way (took VC funding in their early days.) How is anybody supposed to take you seriously if you make broad categorical statements that are factually inaccurate?

scarface74 4y ago
Actually, my statements are very accurate. How many tech companies that were founded since Facebook would anyone call “successful”? Apple only took about $20K of investments and was profitable when it went public Microsoft didn’t need any investments before it went public. Bill Gates took funding to get professional advice. Google was profitable before going public and definitely never had billions in losses. Facebook only went public because it had so many investors that the regulations around reporting got so onerous it was easier to go public. But it also didn’t lose billions of dollars at any point. Amazon was the outlier, but it was also using its cash flow to expand. Most people knew that they could have been profitable at any point by not expanding. Amazon is the only one of the BigTech companies that is capital intensive. Well Apple is to some extent. But it has always had high margins. Even if you look at the second tier profitable tech companies like Intel, Nvidia, Oracle, VMWare, etc., you will see the same thing. None of them had billions of losses (even inflation adjusted) before going public and they were all profitable before their IPO. That means they had a proven profitable business model.
- eloff 4y ago
  Your statements aren't even accurate in this post. First of all there have been tons of successful private and public tech companies in the 100M+ range since Facebook which received venture funding. You can find a whole list of them just in this very website, from YC alone. Many of them profitable, not just focusing on growth and future profitablity. I also don't see a reason to limit things arbitrarily to "since Facebook". Secondly I only fact checked your claim about Apple, but they received much more than $20k of funding. But whether or not those companies were venture funded really doesn't affect my argument. There are tons of successful companies that received venture funding. That you would double down on your claim that it's just a giant Ponzi scheme beggars belief.
  - scarface74 4y ago
    Name them.

by eloff 4y ago

scarface74 4y ago

Actually, my statements are very accurate. How many tech companies that were founded since Facebook would anyone call “successful”? Apple only took about $20K of investments and was profitable when it went public Microsoft didn’t need any investments before it went public. Bill Gates took funding to get professional advice. Google was profitable before going public and definitely never had billions in losses. Facebook only went public because it had so many investors that the regulations around reporting got so onerous it was easier to go public. But it also didn’t lose billions of dollars at any point. Amazon was the outlier, but it was also using its cash flow to expand. Most people knew that they could have been profitable at any point by not expanding. Amazon is the only one of the BigTech companies that is capital intensive. Well Apple is to some extent. But it has always had high margins. Even if you look at the second tier profitable tech companies like Intel, Nvidia, Oracle, VMWare, etc., you will see the same thing. None of them had billions of losses (even inflation adjusted) before going public and they were all profitable before their IPO. That means they had a proven profitable business model.

eloff 4y ago
Your statements aren't even accurate in this post. First of all there have been tons of successful private and public tech companies in the 100M+ range since Facebook which received venture funding. You can find a whole list of them just in this very website, from YC alone. Many of them profitable, not just focusing on growth and future profitablity. I also don't see a reason to limit things arbitrarily to "since Facebook". Secondly I only fact checked your claim about Apple, but they received much more than $20k of funding. But whether or not those companies were venture funded really doesn't affect my argument. There are tons of successful companies that received venture funding. That you would double down on your claim that it's just a giant Ponzi scheme beggars belief.
- scarface74 4y ago
  Name them.