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"Investors don't necessarily want an all-weather business." This may be true for some investors, but the largest hedge fund in the world Bridgewater) is famous

"Investors don't necessarily want an all-weather business." This may be true for some investors, but the largest hedge fund in the world Bridgewater) is famous for their all-weather fund. That means that those investors do exist. If you take that into account, that means that they chose investors who do not want an all-weather company, and thereby gambled not only with their own personal well-being, but with other people's career's and incomes on a risky bet -- as the top comment said, it was obvious that these rates wouldn't stay the same.

dahfizz 4y ago
VC investors don't want an all-weather business. And you don't see very many risk-averse investors who are willing to dump their money into startups.
- KerryJones 4y ago
  I think that's largely true but not absolutely true. What all investors want is return on capital, what VCs are gambling on is that 1/10 (or 2-3 in a 100) are going to be moonshots, they're taking higher risks and hoping for higher rewards. The dichotomy of "higher risk vs higher reward", however, isn't as real as people feel it is. There are low-risk & high rewards style investing (it's the base premise of value investing, whether focused or not). VCs do not want you to lose their money, and so doing something that is predictably bad is not what they want. They do want you to go for moonshots... but again, this is predictably bad. I think you'll be harder pressed to find a company that has continued to do well by over-hiring through pandemic times.
vrc 4y ago
Bridgewater hasn’t been performing great in the recent years, despite their funds maintaining a large pool of AUM
- KerryJones 4y ago
  "despite their funds maintaining..." -- the largest the AUM, the harder it is to make good returns. This is well documented/commented by all the large fund holders. It is significantly easier to make good returns with less money. First google'd item on the subject: https://www.yahoo.com/video/warren-buffett-huge-structural-advantage-162315080.html https://www.yahoo.com/video/warren-buffett-huge-structural-a...

dahfizz 4y ago

VC investors don't want an all-weather business. And you don't see very many risk-averse investors who are willing to dump their money into startups.

KerryJones 4y ago
I think that's largely true but not absolutely true. What all investors want is return on capital, what VCs are gambling on is that 1/10 (or 2-3 in a 100) are going to be moonshots, they're taking higher risks and hoping for higher rewards. The dichotomy of "higher risk vs higher reward", however, isn't as real as people feel it is. There are low-risk & high rewards style investing (it's the base premise of value investing, whether focused or not). VCs do not want you to lose their money, and so doing something that is predictably bad is not what they want. They do want you to go for moonshots... but again, this is predictably bad. I think you'll be harder pressed to find a company that has continued to do well by over-hiring through pandemic times.

vrc 4y ago

Bridgewater hasn’t been performing great in the recent years, despite their funds maintaining a large pool of AUM

KerryJones 4y ago
"despite their funds maintaining..." -- the largest the AUM, the harder it is to make good returns. This is well documented/commented by all the large fund holders. It is significantly easier to make good returns with less money. First google'd item on the subject: https://www.yahoo.com/video/warren-buffett-huge-structural-advantage-162315080.html https://www.yahoo.com/video/warren-buffett-huge-structural-a...