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The words; Horse, Stable and Bolted come to mind. VC's and their stupid valuations have created this problem. The idea that a business isn't worth investing in

by calewis 12y ago

The words; Horse, Stable and Bolted come to mind. VC's and their stupid valuations have created this problem. The idea that a business isn't worth investing in because it's only going to make millions, not billions, also doesn't help. VC's would be better off diversifying in lots more companies that have a better chance of making a more modest profit, than a few that are then pressured to make 10's of billions. I guess ultimately it comes down to the point in which they exit, the dumb PE ratios of Facebook, Twitter etc allowed someone to cash out nicely when they floated, but for the suckers that brought the stock on the public market have no hope of recovering their cash.

adventured 12y ago
You're referring to an extremely small percentage of the venture investment community that is dealing with concerning itself about making billions. I'd argue that's 0.1% of the venture investment activity in the US market (but not 0.1% of the dollars). It's basically a few markets on earth. Go to St. Louis or Dallas and you'll find venture investing going on all over the place that focuses on companies that will make millions and not billions. When you start a hotdog stand, and raise $50,000 from your cousin, that's venture capital too. The US economy is not lacking in VC activity around million dollar businesses. There are more venture capitalists running around funding smaller ventures than at any other time. As I'm sure you know, $50k - $250k is not what it used to be 30 years ago, and it's now very inexpensive to start internet companies. In my experience and observation it has never been easier to raise money for a x million dollar business venture, and I believe this to be true for nearly any city in the US. That investment activity however does not make the headlines, and few people bother to do their research into how many 'boring' deals are being done by investors worth sub $10m that put $25k or $75k into a startup in Cleveland.
tg3 12y ago
Just to fact check you a bit: - Facebook is trading at $76, IPO'ed at $40 - Twitter is trading at $51, IPO'ed at $42

by calewis 12y ago

adventured 12y ago

You're referring to an extremely small percentage of the venture investment community that is dealing with concerning itself about making billions. I'd argue that's 0.1% of the venture investment activity in the US market (but not 0.1% of the dollars). It's basically a few markets on earth. Go to St. Louis or Dallas and you'll find venture investing going on all over the place that focuses on companies that will make millions and not billions. When you start a hotdog stand, and raise $50,000 from your cousin, that's venture capital too. The US economy is not lacking in VC activity around million dollar businesses. There are more venture capitalists running around funding smaller ventures than at any other time. As I'm sure you know, $50k - $250k is not what it used to be 30 years ago, and it's now very inexpensive to start internet companies. In my experience and observation it has never been easier to raise money for a x million dollar business venture, and I believe this to be true for nearly any city in the US. That investment activity however does not make the headlines, and few people bother to do their research into how many 'boring' deals are being done by investors worth sub $10m that put $25k or $75k into a startup in Cleveland.

tg3 12y ago

Just to fact check you a bit: - Facebook is trading at $76, IPO'ed at $40 - Twitter is trading at $51, IPO'ed at $42