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This logic blows my mind. Winning back your penny at the penny slots isn't the result you're playing for, but it's a better result than losing the penny. I do

• wpietri 12y ago
  Which person are you projecting yourself onto here? The CEO doesn't have that choice. He'll get replaced by the investors. The VC investors don't have that choice. It's not their money they're working with. They've promised their investors, the limited partners, that they'll go after high risk, high reward scenarios. If they don't make those gambles, they won't get the capital needed to run. The limited partners also don't generally have that choice with this money. They are people who manage large pools of cash, and part of what they need is long-term, high-reward investments, which are necessarily high risk. [1] They have other money in safe, low-return investments. This money is for go-big-or-go-home bets. This is the devil's bargain people make when they take VC money. There are other ways to build businesses, but they aren't the kind that will let you spend $100m-2b before you get to break-even, which is apparently what it takes to build a social network. [1] http://www.theequitykicker.com/2010/12/01/where-do-vcs-get-their-money-from/ http://www.theequitykicker.com/2010/12/01/where-do-vcs-get-t...