7 ms·
On Shark Tank if you walk in and say “I have no revenue, no viable business model, and an idea that’s easily copied in a space that’s rapidly marching towards c
by JCM9 1y ago
On Shark Tank if you walk in and say “I have no revenue, no viable business model, and an idea that’s easily copied in a space that’s rapidly marching towards commoditization. I’m asking for $5 billion for 25% of my company.” You’d be laughed off the set.
In the increasingly frothy world of GenAI that’s a Wednesday and you get the cheque.
If it looks like a bubble and smells like a bubble…
The tech is cool, but investors are about to lose their shirts in this space.
- awongh 1y agoYou mean, "I have no revenue and no business model but I was the CTO of one of the most important technical companies of this generation, we put out one of the fastest growing SaaS products of all time in a completely new technical category."- not sure how much more signal you would need than that. I don't really get why anyone would be confused about why they are throwing money at her. It's an extremely large amount of money, but it's not as if she has no track record. It is a bubble, of course, but this person would get $100m round in a non-bubble.
- BobbyTables2 1y agoBy that logic it almost sounds as if Meg Whitman was highly qualified to run HP…
- awongh 1y agoShe was qualified. Are you saying that her previous experience shouldn't have counted as a positive attribute for being hired?
- arthurcolle 1y agoIt's a false signal
- xhkkffbf 1y agoIt's true that eBay did well during her tenure. And it's also true that she was a better grownup than the people running it before. But she also said that a monkey could drive the train. Would someone else have done better? Could a monkey have delivered the same results? We'll never know, but the experience at HP doesn't validate her as a business genius.
- BobbyTables2 1y agoThe Sun rose consistently during her tenure at eBay but we certainly don’t give credit for that. eBay would have succeeded even if a Labrador retriever was CEO - due to everyone else’s efforts.
- awongh 1y agoWere so many people saying that when Meg Whitman left eBay? Are people saying that about Mira Murati? -I haven't heard anything to suggest she gets no credit for ChatGPT (the product/technical execution, not the model)
- belter 1y agoAnalysis like this, was what took Yahoo to hire Marissa Mayer :-))
- zanellato19 1y agoWe have a saying in Brazil that goes "The best thing in the world is QI." QI meaning Quem Indica, meaning the best thing in the world is not technical skill, but who you know. This is what stuff like this looks like to me.
- silveraxe93 1y agoIf it's actually that easy, why don't you do it? Are you seriously just leaving $5 billion on the table? I'll tell you why you won't. Because you wouldn't get it. Because it's not that easy. Mira Murati is not some rando off the street. Ilya Sutskever is not some rando. Zuckerberg is not paying Millions to randos of the street to come work for meta.
- belter 1y agoTell me one unique skill, from any of those individuals you quoted, that is worth even 0,01% of $5 billion, for a non existent company with a non existent product.
- mv4 1y agoIt's not a particular skill, it's the experience of having worked with certain people at well-funded and rapidly growing companies.
- computerthings 1y ago[dead]
- ulfw 1y agoLOL. So now it's not even their own skill but the "experience of having worked with certain people at well-funded and rapidly growing companies" that would value a nothingburger 12 Billion dollars. I am sure there must be a better argument that just that. Because I have "worked with certain people at well-funded and rapidly growing companies" a lot and I'm worth nothing whatsoever.
- mirekrusin 1y agoI can be famous actor, when camera is on and you need to smile you smile, when you need to be sad you make sad face, what’s the big deal, right?
- FL33TW00D 1y ago
- nradov 1y agoShark Tank is semi-scripted entertainment. It's not representative of how venture capital works in the real world.
- TrackerFF 1y agoOn the other hand, if for whatever reason some top tier soccer/football/basketball/etc. went to shark tank and said «I want to release my own sportswear brand», they’d probably get their funding. In fact, they’d probably have investors lined up. Same thing here. Mira is a top tier, high-profile person in the AI space. So investors lined up.
- rockwotj 1y agoInvestors are investing just as much in the person/team as what they are building. What they build will change, but having a good team is all the difference.
- Yajirobe 1y ago> If it looks like a bubble and smells like a bubble… People have been saying this for the better part of 10 years
- rchaud 1y agoZero interest rate policy (2008-2022) probably had a hand in that.
- leesec 1y agochatgpt and claude are two of the fastest revenue growing products of all time
- disgruntledphd2 1y agoCorrect, but they're not profitable, rely on quickly depreciating capital assets and loads of tech employees to maintain their services, so it's hard for me to believe that there's a sustainable business here for them. And like, if anyone's gonna win it should be Google because of their ability to push capital into this for a long time, their world class infrastructure and their cost advantage by having their chips in house. But I have faith in their ability to snatch defeat from the jaws of victory.
- dubeye 1y agoWhenever I hear someone say this I file them under 'techie with no business sense or appreciation of user value'
- belter 1y agoWill file your comment under: People who forget VCs regularly burn hundreds of millions of other people’s money, chasing hype. Also...90% of startups, and that is what Thinking Machines is, fail.
- Erem 1y agoBusiness plan, revenue, people: these are all valid signals to form an investment hypothesis. People often outweighs all others wrt early stage companies. You would have been a fool to invest in apple in the late 90s on any other signal than the return of Steve Jobs. That era created many rich fools.
- kirubakaran 1y ago(Setting the current example aside...) When proposing a model for evaluating startup investments -- or any decision-making framework -- it’s useful to run a kind of regression test. Would Shark Tank have funded the most successful startups of the past decade? In many cases, no. They famously passed on companies like Airbnb, Uber, and Dropbox early on (sometimes indirectly via pitch decks or missed introductions), and even directly rejected DoorDash and Cameo, both of which went on to become unicorns. In other cases, they offered terms that, if accepted, would likely have made follow-on funding difficult. That doesn't mean every GenAI deal today is wise. But pointing to Shark Tank as a benchmark for rational investing is a very selective filter. Historically, it’s missed more home runs than it’s hit.