6 ms·

> I’m a complete crypto skeptic who would never touch anything like FTT, but it’s not an obvious Ponzi scheme. I think one of the troubles with crypto is that i

> I’m a complete crypto skeptic who would never touch anything like FTT, but it’s not an obvious Ponzi scheme. I think one of the troubles with crypto is that it’s very easy to operate what is effective a Ponzi scheme, without fully realizing it yourself. I'm pretty certain most of us, at least in the BTC community, were mocking this yield farming as the new ICO since it's inception. The Effective Alturism, and his parent connection to Silicon Valley via Stanford make it clearer this was the typical disruptor cosplaying grifting that happens all the time: see Theranos.

mkagenius 4y ago
> this was the typical disruptor cosplaying grifting Being connected and well off, should now be a sign of lack of inventive mind than having one. VCs think they are risk takers but rather go for well connected SV folks unconsciously or consciously to avoid risks. I hope these two three episodes like Theranos put some sense in them.
- pooper 4y ago
  Problem is that this is only apparent in hindsight. How do you tell apart Theranos and something like Color Labs[techcrunch]? Sometimes it isn't even clear in hindsight. From the outside, both are novel ideas. Both had talented workers working on novel ideas. I don't know enough/anything about biochemistry so I don't know if the vision Theranos sold was even possible but how do I know that the all public all the time but only to someone physically nearby you photo sharing idea (of color) would work either? How do you decide who to back? [Techcrunch] https://techcrunch.com/2011/03/23/color-looks-to-reinvent-social-interaction-with-its-mobile-photo-app-and-41-million-in-funding/ https://techcrunch.com/2011/03/23/color-looks-to-reinvent-so... Edit: another post on HN: what is "growth hacking"? https://news.ycombinator.com/item?id=33582002 https://news.ycombinator.com/item?id=33582002
  - linuxftw 4y ago
    As a lay person, it might be difficult. As a well funded VC, I'd expect due diligence beyond the level of 'let me see your balance sheet' before investing millions of dollars. One particular item of fraud was the claim that their machines were on helicopters in US-led war zones. Okay, show me the contract details for this, or some kind of evidence this is actually true, and then I will verify with the counter party to ensure it's not completely bologna. Not to mention the entire concept of 'nano-tainers' and doing blood work with a single drop of blood seemed physically improbable, and literal Nobel level scientists would need to be involved, people with decades of experience in the field, not a random college dropout. > all public all the time but only to someone physically nearby you photo sharing idea (of color) would work either? I can't see the appeal of that whatsoever. At least with instagram or whatever you can have followers, and then monetize those followers one way or another. On the flip side, it might be an interesting avenue for prostitutes and drug dealers to advertise their services discretely in public places.
    - acdha 4y ago
      > As a well funded VC, I'd expect due diligence beyond the level of 'let me see your balance sheet' before investing millions of dollars. Yes. At the time it was not hard to find people who did have expertise in the relevant fields expressing skepticism. It definitely wouldn’t have been hard to kick $50k in consulting work to some postdoc to act as your advisor when the investment is orders of magnitude greater.
    - jjeaff 4y ago
      I don't think that Theranos had a lot of traditional VC funding. Tim Draper was the first investor and apparently neighbors with Elizabeth Holmes and pretty much the only VC I saw on the list. But he was the first investor so there may have been nothing to do due diligence on at that point. But then she got money from the DeVos family, the Waltons, Rupert Murdoch, Larry Ellison, Oppenheimers, and several other huge names. Proof that lots of money does not necessarily make one a "sophisticated" investor. But maybe the $50m-$100m that each of those investors put in wasn't enough to be worth their time to do any due diligence.
- williamcotton 4y ago
  > Being connected and well off, should now be a sign of lack of inventive mind than having one. Or how about it is neutral?
  - Melting_Harps 4y ago
    > Or how about it is neutral? That is never the case in the VC model; who knows you will always be more important than what you know or who you know. It's often tolerated because the king makers like Altman at YV spread the funds far enough for it to be seen as 'fair' but it's always been an insiders game if you wanted anything but a total take over for funding since capital got so concentrated in those systems.

mkagenius 4y ago

> this was the typical disruptor cosplaying grifting Being connected and well off, should now be a sign of lack of inventive mind than having one. VCs think they are risk takers but rather go for well connected SV folks unconsciously or consciously to avoid risks. I hope these two three episodes like Theranos put some sense in them.

pooper 4y ago
Problem is that this is only apparent in hindsight. How do you tell apart Theranos and something like Color Labs[techcrunch]? Sometimes it isn't even clear in hindsight. From the outside, both are novel ideas. Both had talented workers working on novel ideas. I don't know enough/anything about biochemistry so I don't know if the vision Theranos sold was even possible but how do I know that the all public all the time but only to someone physically nearby you photo sharing idea (of color) would work either? How do you decide who to back? [Techcrunch] https://techcrunch.com/2011/03/23/color-looks-to-reinvent-social-interaction-with-its-mobile-photo-app-and-41-million-in-funding/ https://techcrunch.com/2011/03/23/color-looks-to-reinvent-so... Edit: another post on HN: what is "growth hacking"? https://news.ycombinator.com/item?id=33582002 https://news.ycombinator.com/item?id=33582002
- linuxftw 4y ago
  As a lay person, it might be difficult. As a well funded VC, I'd expect due diligence beyond the level of 'let me see your balance sheet' before investing millions of dollars. One particular item of fraud was the claim that their machines were on helicopters in US-led war zones. Okay, show me the contract details for this, or some kind of evidence this is actually true, and then I will verify with the counter party to ensure it's not completely bologna. Not to mention the entire concept of 'nano-tainers' and doing blood work with a single drop of blood seemed physically improbable, and literal Nobel level scientists would need to be involved, people with decades of experience in the field, not a random college dropout. > all public all the time but only to someone physically nearby you photo sharing idea (of color) would work either? I can't see the appeal of that whatsoever. At least with instagram or whatever you can have followers, and then monetize those followers one way or another. On the flip side, it might be an interesting avenue for prostitutes and drug dealers to advertise their services discretely in public places.
  - acdha 4y ago
    > As a well funded VC, I'd expect due diligence beyond the level of 'let me see your balance sheet' before investing millions of dollars. Yes. At the time it was not hard to find people who did have expertise in the relevant fields expressing skepticism. It definitely wouldn’t have been hard to kick $50k in consulting work to some postdoc to act as your advisor when the investment is orders of magnitude greater.
  - jjeaff 4y ago
    I don't think that Theranos had a lot of traditional VC funding. Tim Draper was the first investor and apparently neighbors with Elizabeth Holmes and pretty much the only VC I saw on the list. But he was the first investor so there may have been nothing to do due diligence on at that point. But then she got money from the DeVos family, the Waltons, Rupert Murdoch, Larry Ellison, Oppenheimers, and several other huge names. Proof that lots of money does not necessarily make one a "sophisticated" investor. But maybe the $50m-$100m that each of those investors put in wasn't enough to be worth their time to do any due diligence.
williamcotton 4y ago
> Being connected and well off, should now be a sign of lack of inventive mind than having one. Or how about it is neutral?
- Melting_Harps 4y ago
  > Or how about it is neutral? That is never the case in the VC model; who knows you will always be more important than what you know or who you know. It's often tolerated because the king makers like Altman at YV spread the funds far enough for it to be seen as 'fair' but it's always been an insiders game if you wanted anything but a total take over for funding since capital got so concentrated in those systems.