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Dead simple: Many VC's aren't very smart and/or ethical. How many major Silicon Valley scandals are VCs involved in? 100%. And for the most part they get a

Dead simple: Many VC's aren't very smart and/or ethical. How many major Silicon Valley scandals are VCs involved in? 100%. And for the most part they get a pass. This end of the era of easy money is going to reveal that many of the "geniuses of our time" are nothing of the like.

tootie 4y ago
The stuff that Sequoia said about him is almost unreal. They talked like he was going to be the greatest entrepreneur in human history. All because he exploited a momentary arbitrage in Japanese Bitcoin exchanges. Then they gave him shitloads of money and acceded to not getting board seats. I honestly wonder if they were that trusting or they just wanted to maintain deniability.
- nullc 4y ago
  > All because he exploited a momentary arbitrage in Japanese Bitcoin exchanges. Originally the story was korean exchanges; he changed to saying Japanese, presumably after too many people pointed out the korean story was impossible. (The Japanese story was also more or less impossible, they could have made a bit of money maybe even millions but not the $10+bn he claimed)
  - dahdum 4y ago
    They made ~$10-30m from the Japan arb from what I've read, mostly blew it, but it still got Alameda off the ground. The Korean arb was the initial goal but proved too difficult. Both of these arbs were glaringly obvious and talked about constantly, but difficult to pull off due to banking hurdles in both countries.
- duped 4y ago
  The pitch deck you give to Sequioa partners is not a description of your current business. It's a proof of concept that shows how much the market you're entering is worth and a long term vision of how you can carve a significant piece out of it. So you don't go in saying "hey look we can make a trillion dollars doing arbitrage between American, Japanese and Korean exchanges." You go in showing that your work doing the former proved the existence of a massive market for crypto securities and derivatives, and how you're uniquely positioned to capitalize on that market. And if they believe in the existence of that market and the founders are able to execute they'll invest. That's what they mean about investing in founders and teams.
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tootie 4y ago

The stuff that Sequoia said about him is almost unreal. They talked like he was going to be the greatest entrepreneur in human history. All because he exploited a momentary arbitrage in Japanese Bitcoin exchanges. Then they gave him shitloads of money and acceded to not getting board seats. I honestly wonder if they were that trusting or they just wanted to maintain deniability.

nullc 4y ago
> All because he exploited a momentary arbitrage in Japanese Bitcoin exchanges. Originally the story was korean exchanges; he changed to saying Japanese, presumably after too many people pointed out the korean story was impossible. (The Japanese story was also more or less impossible, they could have made a bit of money maybe even millions but not the $10+bn he claimed)
- dahdum 4y ago
  They made ~$10-30m from the Japan arb from what I've read, mostly blew it, but it still got Alameda off the ground. The Korean arb was the initial goal but proved too difficult. Both of these arbs were glaringly obvious and talked about constantly, but difficult to pull off due to banking hurdles in both countries.
duped 4y ago
The pitch deck you give to Sequioa partners is not a description of your current business. It's a proof of concept that shows how much the market you're entering is worth and a long term vision of how you can carve a significant piece out of it. So you don't go in saying "hey look we can make a trillion dollars doing arbitrage between American, Japanese and Korean exchanges." You go in showing that your work doing the former proved the existence of a massive market for crypto securities and derivatives, and how you're uniquely positioned to capitalize on that market. And if they believe in the existence of that market and the founders are able to execute they'll invest. That's what they mean about investing in founders and teams.

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