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On the most recent TechStars/Bloomberg startup reality show, a couple of investors tongue in cheek talked about investing in the career earnings of one of the e
by DevX101 15y ago
On the most recent TechStars/Bloomberg startup reality show, a couple of investors tongue in cheek talked about investing in the career earnings of one of the entrepreneurs whom they thought had a lot of promise. Although the investors probably weren't too serious about this point, I don't think its a bad idea. If Gowalla investors had struck such a deal with the founders of Gowalla then of course they'd be entitled to some of the stock grants that Facebook offered. But they didn't. They invested in the company which failed, so they get nada.
And I give absolutely no credence to the argument that the investors funds boosted the profile of Gowalla founders so they wouldn't have gotten great deals from Facebook if it weren't for their investment. If that's the case, then limited partners should be entitled to a share of the profits from a VC's second fund if the first one goes bust. Because, you know, it was the limited partners' money that gave you a name in the VC community in the first place. Of course, no one takes such an argument seriously in the finance community, and neither should you entrepreneurs.
- Jasber 15y agoFYI this actually happened: http://venturebeat.com/2010/03/03/life-investment/ http://venturebeat.com/2010/03/03/life-investment/
- jrockway 15y agoSee also: taxes. The government subsidizes school (in some form) from kindergarten to your PhD, and in return, you pay them back in the form of taxes as soon as you use that knowledge to make money.
- gyardley 15y agoVery odd example, no? While pooled revenue from taxes does pay for collective benefits, any single individual's taxes are only tenuously related to the benefits they receive. If it worked like you described, I'd expect a break from the IRS since my education mostly took place elsewhere, and I'd still be writing checks to the Canadian government for the education and healthcare I got as a child. (That wouldn't necessarily be a bad thing, but it's not how it works.)
- nekojima 15y agoYou'd be writing cheques to the Canadian govt. Checks are something on clothing or you put in boxes. :-D
- gyardley 15y agoCut me a little slack, I've been down here for a decade now. :)
- mnutt 15y agoJust like amount invested in a company is tenuously related to the returns you'll make. From the government's perspective, they make a blanket investment in everybody in the form of providing education and services. Some people end up paying huge amounts back in taxes, others pay nothing back.
- anamax 15y agoI'm pretty sure my parents, not some abstraction, were paying for those things.