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This is not a quality article. Presumably, the author is responding to Marc Andreessen's comments here: http://www.businessinsider.com/marc-andreessen-on-star

by jasode 12y ago

This is not a quality article. Presumably, the author is responding to Marc Andreessen's comments here: http://www.businessinsider.com/marc-andreessen-on-startup-burn-rates-worry-2014-9 http://www.businessinsider.com/marc-andreessen-on-startup-bu... However, the author has ignored the qualifiers and substance of Marc's comments. Marc specifically said, "behind the scenes, they're plowing through that money either on marketing, overhead, or some other expense, which results in high burn rates." Marc is talking about companies like Pets.com blowing wads of cash on Superbowl ads. He's not talking about a company like Tesla spending a lot of money on battery innovation and other core research. I think Marc knows the difference between the "burn rates" of Pets.com vs Tesla.

jgalt212 12y ago
> Marc is talking about companies like Pets.com blowing wads of cash on Superbowl ads. He's not talking about a company like Tesla spending a lot of money on battery innovation and other core research. I think Marc knows the difference between the "burn rates" of Pets.com vs Tesla. Who's to say Tesla is spending their money wisely on battery tech investments? Only time will tell if their battery R&D bets will pay off and if not, perhaps they would have been better off spending that money on Super Bowl advertising.
- jasode 12y ago
  >Only time will tell if their battery R&D bets will pay My comment was not about an omniscient oracle predicting the future of winners and losers. Yes, Tesla may ultimately fail. We don't know yet. The article is bad quality because it misrepresents the statements by the VCs he's responding to. The three VCs Bill Gurley (Benchmark), Marc Andreessen (AH), Fred Wilson (Union Square Ventures) of all people would absolutely know that you have to spend money to make money. And yes, that would sometimes involve high burn rates. The author sets up a straw man by implying those VCs are so financially inept that they only look at "burn rate" in a naked and isolated manner with zero context to what each company is doing with the money. Therefore, he's supposedly the lone voice of reason. He thinks he's doing us a favor by explaining to us that "high burn rate" can be good and we're now smarter than those VCs for being englightened with such knowledge. Really?! I think that's insulting the intelligence of HN readers. Seriously, does anyone think that Marc Andreessen who lived through the zero-profit cash burning days of Netscape before & after the IPO has no clue about stupid-vs-smart high burn rates? Tesla is burning a lot of cash, and they may fail. If so, they would have gone down in a blaze of glory by way of investing in their technology and betting wrong instead of spending stupid money on distractions such as Superbowl ads.

by jasode 12y ago

jgalt212 12y ago

> Marc is talking about companies like Pets.com blowing wads of cash on Superbowl ads. He's not talking about a company like Tesla spending a lot of money on battery innovation and other core research. I think Marc knows the difference between the "burn rates" of Pets.com vs Tesla. Who's to say Tesla is spending their money wisely on battery tech investments? Only time will tell if their battery R&D bets will pay off and if not, perhaps they would have been better off spending that money on Super Bowl advertising.

jasode 12y ago
>Only time will tell if their battery R&D bets will pay My comment was not about an omniscient oracle predicting the future of winners and losers. Yes, Tesla may ultimately fail. We don't know yet. The article is bad quality because it misrepresents the statements by the VCs he's responding to. The three VCs Bill Gurley (Benchmark), Marc Andreessen (AH), Fred Wilson (Union Square Ventures) of all people would absolutely know that you have to spend money to make money. And yes, that would sometimes involve high burn rates. The author sets up a straw man by implying those VCs are so financially inept that they only look at "burn rate" in a naked and isolated manner with zero context to what each company is doing with the money. Therefore, he's supposedly the lone voice of reason. He thinks he's doing us a favor by explaining to us that "high burn rate" can be good and we're now smarter than those VCs for being englightened with such knowledge. Really?! I think that's insulting the intelligence of HN readers. Seriously, does anyone think that Marc Andreessen who lived through the zero-profit cash burning days of Netscape before & after the IPO has no clue about stupid-vs-smart high burn rates? Tesla is burning a lot of cash, and they may fail. If so, they would have gone down in a blaze of glory by way of investing in their technology and betting wrong instead of spending stupid money on distractions such as Superbowl ads.