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Isn't high risk by definition what a VC investment is? I'm asking, not stating because maybe my assumption is wrong. I thought VC's look for the high returns
by joedev 15y ago
Isn't high risk by definition what a VC investment is? I'm asking, not stating because maybe my assumption is wrong. I thought VC's look for the high returns which come along with high risk (vs. banks looking to make low risk loans).
- ChuckMcM 15y agoYes, but that risk has flavors. Funding the Moon Landing was exceptionally high risk [1] because NASA did not yet have a minimum viable product. VC's that I've met don't usually take that level risk, they wait until there is at least some expectation that the team can deliver something (hence the MVP requirement in many series A rounds). [1] In "Proofiness: The Dark Arts of Mathematical Deception", Charles Seife claims that NASA asked GE to calculate the chances of success in the Moon Landing and came out with 5%. http://www.amazon.com/Proofiness-Dark-Arts-Mathematical-Deception/dp/0670022160 http://www.amazon.com/Proofiness-Dark-Arts-Mathematical-Dece...