11 ms·

Yet some VCs are still plowing into web3. There was an article today about how Moellis was getting into Web3 companies. I'm genuinely curious what their thought

Yet some VCs are still plowing into web3. There was an article today about how Moellis was getting into Web3 companies. I'm genuinely curious what their thought process is. I tend to be in the camp that web3 is just a bunch of hot air seeing how cryptos been around for quite a while now with few use cases, but I also give benefit of the doubt there could be something there given the nature of tech.

itsoktocry 4y ago
>Yet some VCs are still plowing into web3 Some VCs, some even with legendary reputations, are going to ruin said reputations from the scams they're pushing. In 10 years much of the sheen of Silicon Valley will have worn off. Tech will be as beloved as banking.
lordnacho 4y ago
Moelis advise on M&A though. They get fees from companies doing steps with each other, which they do in both good times and bad (aka restructuring). I didn't think it meant Moelis was investing in those companies. It's like a lawyer getting into crypto, they do contracts for the companies, they're not buying tokens for themselves.
- mr_gibbins 4y ago
  The ones who made fortunes during the American gold rush were the people selling shovels, not the ones panning for gold.
  - thematrixturtle 4y ago
    Unfortunately in the crypto winter, crypto shovel sellers like Coinbase are doing quite badly as well.
    - bobnamob 4y ago
      I think you need to go a layer or two deeper to find the shovel vendors, maybe those selling compute?
      - Someone 4y ago
        Nvidia and AMD sold quite a few GPUs to crypto miners.
        Strom 4y ago
        It seems that they also bet on the hypetrain lasting longer. They are now trying to cancel some of their TSMC orders. [1] They'll probably end up with a juicy profit overall anyway, but perhaps the more clear shovel sellers here are foundries like TSMC and Samsung. -- [1] https://videocardz.com/newz/nvidia-reportedly-wants-to-cut-tsmc-orders-for-next-gen-rtx-40-gpus-5nm-wafers-amid-lower-demand https://videocardz.com/newz/nvidia-reportedly-wants-to-cut-t...
        IgorPartola 4y ago
        Clear winner is energy companies who sell electricity to miners :(
        xchaotic 4y ago
        Investing into an illegally tapped coal power plant in Mongolia is about as safe an investment as investment in crypto itself.
      - thematrixturtle 4y ago
        People using stolen credentials to mine crypto on cloud GPUs is a huge hassle/financial loss for cloud vendors.
      - stonith 4y ago
        NVIDIA seem to have done pretty well out of it.
  - SnowHill9902 4y ago
    Correction: all of those selling shovels, a few of those who found gold. It’s different distributions.
    - oblio 4y ago
      True, which is even more relevant for something like blockchain techs, which are basically bets.
arcticbull 4y ago
> I'm genuinely curious what their thought process is. The thought process for VCs investing in crypto is simple: they get a huge discount on the tokens in the raise that they can turn around and dump on retail a few months later for huge returns. Instead of waiting 10+ years for a traditional exit, they can get liquidity in a few months. As Chamath admitted on the podcast, even when they're on a vesting schedule they can sell the claims to future vesting prior to actually receiving the tokens.
- gingerlime 4y ago
  That’s my understanding as well after listening to Crypto Critics and Griftonomics podcasts. Highly recommend both although so much stuff is way over my head. I wish there was a beginner’s version :)
  - retcon 4y ago
    I'd like to recommend a shelf of great to read erudite and intelligible financial history and financial social history and technicality, from which you'd recognize the simulacra, but it wouldn't help very much because this crypto game strips out everything fundamental economic and human from their imaginary systems and leaves solely a caricature of a carcass. I'm despondent about the overall crypto situation, please forgive me for my cynicism, because I'm genuinely concerned about how many times people can exclaim the king is naked the cupboard is bare the promises aren't merely empty but never had meaning, and yet the socialized penny just won't drop. This FT article [0] goes some way to describing how vulnerable young and low income people are to false investment scheming. What's needed (very rapidly) is to reveal the full extent of behavioural and technical engineering used in exploitation, instead of blaming the phenomenon on concocted reductio ad infortunium. [0] Financial Times article "Generation Moonshot": https://archive.ph/3d4DW https://archive.ph/3d4DW Edit,: added for clarity, "...from which...the simulacra.."; corrected "onto" as "on" and thereafter revised with clearer unchanged meaning the rest of final sentence. (and Ed2 sp ip.); E3 people instead of folk ,(mobile sorry) E4 added, "scheming" after "false investment" for clarity.
    - 4y ago
nobody9999 4y ago
>Yet some VCs are still plowing into web3. There was an article today about how Moellis was getting into Web3 companies. I'm genuinely curious what their thought process is. I'd hazard a guess that it's something along the lines of "throw shit against the wall and see if anything sticks," or less cynically "run it up the flagpole and see if anyone salutes." Isn't that pretty much the modus operandi of VCs? Invest in a bunch of speculative ventures and hopefully make all of it (and much, much more) back if/when one or more becomes profitable?
mathattack 4y ago
That sounds like banker’s getting into the game late.

itsoktocry 4y ago

>Yet some VCs are still plowing into web3 Some VCs, some even with legendary reputations, are going to ruin said reputations from the scams they're pushing. In 10 years much of the sheen of Silicon Valley will have worn off. Tech will be as beloved as banking.

lordnacho 4y ago

Moelis advise on M&A though. They get fees from companies doing steps with each other, which they do in both good times and bad (aka restructuring). I didn't think it meant Moelis was investing in those companies. It's like a lawyer getting into crypto, they do contracts for the companies, they're not buying tokens for themselves.

mr_gibbins 4y ago
The ones who made fortunes during the American gold rush were the people selling shovels, not the ones panning for gold.
- thematrixturtle 4y ago
  Unfortunately in the crypto winter, crypto shovel sellers like Coinbase are doing quite badly as well.
  - bobnamob 4y ago
    I think you need to go a layer or two deeper to find the shovel vendors, maybe those selling compute?
    - Someone 4y ago
      Nvidia and AMD sold quite a few GPUs to crypto miners.
      - Strom 4y ago
        It seems that they also bet on the hypetrain lasting longer. They are now trying to cancel some of their TSMC orders. [1] They'll probably end up with a juicy profit overall anyway, but perhaps the more clear shovel sellers here are foundries like TSMC and Samsung. -- [1] https://videocardz.com/newz/nvidia-reportedly-wants-to-cut-tsmc-orders-for-next-gen-rtx-40-gpus-5nm-wafers-amid-lower-demand https://videocardz.com/newz/nvidia-reportedly-wants-to-cut-t...
        IgorPartola 4y ago
        Clear winner is energy companies who sell electricity to miners :(
        xchaotic 4y ago
        Investing into an illegally tapped coal power plant in Mongolia is about as safe an investment as investment in crypto itself.
    - thematrixturtle 4y ago
      People using stolen credentials to mine crypto on cloud GPUs is a huge hassle/financial loss for cloud vendors.
    - stonith 4y ago
      NVIDIA seem to have done pretty well out of it.
- SnowHill9902 4y ago
  Correction: all of those selling shovels, a few of those who found gold. It’s different distributions.
  - oblio 4y ago
    True, which is even more relevant for something like blockchain techs, which are basically bets.

arcticbull 4y ago

> I'm genuinely curious what their thought process is. The thought process for VCs investing in crypto is simple: they get a huge discount on the tokens in the raise that they can turn around and dump on retail a few months later for huge returns. Instead of waiting 10+ years for a traditional exit, they can get liquidity in a few months. As Chamath admitted on the podcast, even when they're on a vesting schedule they can sell the claims to future vesting prior to actually receiving the tokens.

gingerlime 4y ago
That’s my understanding as well after listening to Crypto Critics and Griftonomics podcasts. Highly recommend both although so much stuff is way over my head. I wish there was a beginner’s version :)
- retcon 4y ago
  I'd like to recommend a shelf of great to read erudite and intelligible financial history and financial social history and technicality, from which you'd recognize the simulacra, but it wouldn't help very much because this crypto game strips out everything fundamental economic and human from their imaginary systems and leaves solely a caricature of a carcass. I'm despondent about the overall crypto situation, please forgive me for my cynicism, because I'm genuinely concerned about how many times people can exclaim the king is naked the cupboard is bare the promises aren't merely empty but never had meaning, and yet the socialized penny just won't drop. This FT article [0] goes some way to describing how vulnerable young and low income people are to false investment scheming. What's needed (very rapidly) is to reveal the full extent of behavioural and technical engineering used in exploitation, instead of blaming the phenomenon on concocted reductio ad infortunium. [0] Financial Times article "Generation Moonshot": https://archive.ph/3d4DW https://archive.ph/3d4DW Edit,: added for clarity, "...from which...the simulacra.."; corrected "onto" as "on" and thereafter revised with clearer unchanged meaning the rest of final sentence. (and Ed2 sp ip.); E3 people instead of folk ,(mobile sorry) E4 added, "scheming" after "false investment" for clarity.
  - 4y ago

nobody9999 4y ago

>Yet some VCs are still plowing into web3. There was an article today about how Moellis was getting into Web3 companies. I'm genuinely curious what their thought process is. I'd hazard a guess that it's something along the lines of "throw shit against the wall and see if anything sticks," or less cynically "run it up the flagpole and see if anyone salutes." Isn't that pretty much the modus operandi of VCs? Invest in a bunch of speculative ventures and hopefully make all of it (and much, much more) back if/when one or more becomes profitable?

mathattack 4y ago

That sounds like banker’s getting into the game late.