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Anyone who has really looked at the 2nd order effects. SV-style tech startups distribute more equity to employees than any other sector of business I know of a
by AlchemistCamp 4y ago
Anyone who has really looked at the 2nd order effects.
SV-style tech startups distribute more equity to employees than any other sector of business I know of and the average VC’s returns are worse than private equity, worse than the stock market and worse than real estate. You only hear about the biggest winners, but venture capitalists are taking on very long odds and the vast majority lose. More importantly, we all benefit from the advances the industry leads to—such as this wonderful phone I’m typing this comment into that can access and search nearly any encyclopedia, map or song in the world in seconds, from almost anywhere.
- scarface74 4y agoEquity that will statistically be worthless? You might as well say Hasbro distributes more money than most companies because of all of the Monopoly games they sell.
- molsongolden 4y agoIf startup equity is worthless then that will usually mean the VCs make no return on their investment. If VCs make no return on their investment then they have just dumped millions of dollars into the pockets of startup employees and vendors.
- scarface74 4y agoAnd those employees would be statistically better off working for one of the public BigTech companies that give salaries + RSUs. I can trade my RSUs for real cash every six months after they are deposited in my account. I know the potential value of my next RSU grant every 15 minutes as it is updated on my Google Sheets. The VCs make a return by diversifying their bets. But as an employee for a startup, you are not well diversified. On a related note, Warren Buffett made a bet with hedge funds that he could have better returns just by investing money in an index fund over 10 years - he won
- molsongolden 4y agoNo disagreement here. Ignoring the other pros/cons of BigTech vs. startup work culture that some might mention, many startup employees would take BigTech jobs if they could. Not everybody can land a BigTech job though.
- throwwwaway69 4y agoBeen a while since I've seen the trickle down economics argument
- haiti_outlaw 4y ago> such as this wonderful phone I’m typing this comment into that can access and search nearly any encyclopedia, map or song in the world in seconds, from almost anywhere. Cell phones were not created by tech startups.
- AlchemistCamp 4y agoNo, but most the apps on my phone were. This includes the web browser itself (pioneered by Netscape), Google search, web-based email (Hotmail), mapping (Mapquest), and many, many others.