3 ms·

Like what? What other funding methods exist? Do they work? What are their downsides?

chmod775 1y ago
Do you believe the vast majority of investment happens because someone like Elon Musk personally goes around to give every little venture money? Here's a non-exhaustive list of ways the wealth of multiple people can be pooled: creating a joint account, investment clubs, general/limited partnerships, LLCs, crowdfunding platforms, and syndicates (you're on the website of one right now). There's also government-backed pooling/funding vehicles and banks engaging in various forms of investment, funding, loans. Any existing corporation is also capable of investing themselves.
- vorpalhex 1y ago
  And YCombinator... is funded by a bunch of venture capitalists. Wealth funds.. are made up of wealthy investors. LLCs and Partnerships are just company structures and typically exist.. to invest the wealth of the proprietors when formed as an investment vehicle. Government backed funds.. generally don't invest in businesses. There are exceptions - strategic investments for wartime materials and such. Banks are also.. backed and run by wealthy individuals. This is less "big fish" focused because the bank itself is the owner of the assets and pays a salary to it's executives, but traditionally the person who ran and backed the bank WAS the local wealthy person. When we look at governments where there aren't really private investors (ie the wealthy) those governments just can't fund things quickly or effectively. Capitalism is an engine. Liquidity is momentum. Having liquidity leads to more liquidity and wealth, liquidity allows you to get other operations running. There is no magical government bucket of money. No magical government investors.
  - chmod775 1y ago
    Nice comment. Too bad it's immediately proven wrong by reality and hard numbers. Also as a side note: We were talking about ultra wealthy, not people with some wealth. For the US as a whole only about 10-15% of startup capital ultimately comes from private investors (of which only some are ultra wealthy). The majority comes from institutions (so ultimately mostly from pension funds)[1] Ycombinator obviously also sources capital from institutional investors, though we do not know to what degree. Can't wait to find out where we're gonna move goalposts now - please don't keep me in suspense. [1] https://www.pragmaticcoders.com/wp-content/uploads/2025/09/Pragmatycznie-o.-tym-skad-sie-biora-pieniadze-w-startupach-1.jpeg.webp https://www.pragmaticcoders.com/wp-content/uploads/2025/09/P...

Do you believe the vast majority of investment happens because someone like Elon Musk personally goes around to give every little venture money? Here's a non-exhaustive list of ways the wealth of multiple people can be pooled: creating a joint account, investment clubs, general/limited partnerships, LLCs, crowdfunding platforms, and syndicates (you're on the website of one right now). There's also government-backed pooling/funding vehicles and banks engaging in various forms of investment, funding, loans. Any existing corporation is also capable of investing themselves.

vorpalhex 1y ago
And YCombinator... is funded by a bunch of venture capitalists. Wealth funds.. are made up of wealthy investors. LLCs and Partnerships are just company structures and typically exist.. to invest the wealth of the proprietors when formed as an investment vehicle. Government backed funds.. generally don't invest in businesses. There are exceptions - strategic investments for wartime materials and such. Banks are also.. backed and run by wealthy individuals. This is less "big fish" focused because the bank itself is the owner of the assets and pays a salary to it's executives, but traditionally the person who ran and backed the bank WAS the local wealthy person. When we look at governments where there aren't really private investors (ie the wealthy) those governments just can't fund things quickly or effectively. Capitalism is an engine. Liquidity is momentum. Having liquidity leads to more liquidity and wealth, liquidity allows you to get other operations running. There is no magical government bucket of money. No magical government investors.
- chmod775 1y ago
  Nice comment. Too bad it's immediately proven wrong by reality and hard numbers. Also as a side note: We were talking about ultra wealthy, not people with some wealth. For the US as a whole only about 10-15% of startup capital ultimately comes from private investors (of which only some are ultra wealthy). The majority comes from institutions (so ultimately mostly from pension funds)[1] Ycombinator obviously also sources capital from institutional investors, though we do not know to what degree. Can't wait to find out where we're gonna move goalposts now - please don't keep me in suspense. [1] https://www.pragmaticcoders.com/wp-content/uploads/2025/09/Pragmatycznie-o.-tym-skad-sie-biora-pieniadze-w-startupach-1.jpeg.webp https://www.pragmaticcoders.com/wp-content/uploads/2025/09/P...