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Have we forgotten how venture capital (VC) is supposed to work? A new technology comes out. The new tech has high startup costs and low marginal costs. You inv
by anthomtb 2y ago
Have we forgotten how venture capital (VC) is supposed to work?
A new technology comes out. The new tech has high startup costs and low marginal costs. You invest in 10 companies developing this new tech. 8 go bankrupt, one hangs on by a thread, the last one returns 1000x on what you invested.
Last I checked, Y-Combinator is still considered a VC firm. Investing in a bunch of firms doing the same or very similar things is what YC should be doing.
- dehrmann 2y agoThey're really just keeping multiple irons in the fire. If the space is a winner, another player increases YC's chance of betting on the winner. More players also means the space gets explored in different ways.
- frigidnonce 2y ago> Last I checked, Y-Combinator is still considered a VC firm. There was a time when pg would come out swinging and say that YC invests their own money which is very different from a VC firm. Well, it did make YC different in the past: they took bets no one else would, which they could afford because of such a position. Is that still true? I’m not sure.