The American VC system is disgusting. It allows a few wealthy individuals to choose winners not because they are the best solution, but just because through nefarious tactics they are the last ones standing.
This is nonsense logic and the very reason not to use cash-based accounting for anything serious.
They raised capital, therefore they have the money. Basically all companies start off "losing money" because most investments don't instantaneously produce their full return. How would anybody ever open a factory or a restaurant if they had to be profitable before spending any money on anything that generates profit? You can't use the profit from making widgets to build your first widget factory because you need a widget factory to make widgets.
Right, and as a result of this, the companies that have capital can always beat out the ones that don't. Who gets to decide which companies get capital? VCs. So that means that it's not the market that decides who wins and loses, it's VCs. Does that sound like the intention of capitalism to you?
Having a better or more efficient idea is meaningless in today's economy. All that matters is how big your warchest is, and how many rich investors you have in your pocket.
If your idea requires capital to execute and you don't have any then you can't execute it. How do you propose to change that?
> Who gets to decide which companies get capital? VCs. So that means that it's not the market that decides who wins and loses, it's VCs.
Who gets to decide which companies get capital? Venture capitalists. In other words, people with capital are the ones who decide which companies get capital. This is almost tautologically true.
But that is the market. The VCs fund the companies they think have the most promise. If you have a good idea but not capital then you convince some people with capital to fund you so you can execute it. That's what VC is.
What are you proposing as an alternative? One where raising capital is impossible and so you were either born with it or you're stuck working hand to mouth at a McJob forever because your idea takes more funding to execute that you can save in a lifetime as a wage slave?
