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0 pointsscarface_741y ago0 comments

Let’s not pretend that YC and other VCs are noble. They get rich and pawn their money losing investments to the “bigger fool”

https://medium.com/@kazeemibrahim18/the-post-ipo-performance...

> In aggregate, the average return across these YC companies is -49%, with a median return of -46%. To put this into perspective, over the same period, the S&P 500 yielded a positive return of 58%

And for the rest of the companies, they aren’t trying to compete with BigTech, they are trying to get acquired by them. Out of the literally thousands of companies that YC has invested in, only about two dozen have gone public

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6 comments · 2 top-level

darth_avocado1y ago· 2 in thread

VC firms, not specifically YC, also tend to encourage monopolization when it comes to startups they are invested in. Have we not seen unicorns gobble up other smaller startups all the time?

echelon1y ago

You can compete with a unicorn. You can't compete with a trillion dollar company with a cash hoard larger than every unicorn.

jeroenhd1y ago

Which is how AirBnB ruined tourist industries worldwide, caused rents to soar, people to get displaced from their cities of birth, and why they're touted as a "disruptor" in this very brief.

The end game for these unicorns is to become the cash hoard that they intended to compete with.

echelon1y ago· 2 in thread

> Let’s not pretend that YC and other VCs are noble.

I'm fine with that. Let them make money at the expense of big tech.

Breaking up big tech benefits financial/venture capital, but it also benefits labor capital as well. More opportunity for more startups to succeed, more competition for engineering talent, less market distorting wage collusion.

Big tech already won. It's benefactors already reap the benefits. Break them up and a new generation of engineers can grow wealthy on the field they contribute their labor to.

Right now the proceeds of tech go to hedge funds and pension funds. It's venture capital and entrepreneurs that take risks. They're the ones that should see upside. Unfortunately, big tech monopolies put a ceiling on this.

scarface_74OP1y ago

They do see upside - by being acquired by BigTech.

So if Google wasn’t a “monopoly” you think a startup could make a better search engine? Be more popular than Android - Microsoft tried both and failed because people prefer Google products. It wasn’t for the lack of money.

And engineers are getting wealthy - by working for BigTech. Even an entry level developer at BigTech makes more than 90% of workers.

echelon1y ago

That's a low ceiling.

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6 comments · 2 top-level

darth_avocado1y ago· 2 in thread

VC firms, not specifically YC, also tend to encourage monopolization when it comes to startups they are invested in. Have we not seen unicorns gobble up other smaller startups all the time?

echelon1y ago

You can compete with a unicorn. You can't compete with a trillion dollar company with a cash hoard larger than every unicorn.

jeroenhd1y ago

Which is how AirBnB ruined tourist industries worldwide, caused rents to soar, people to get displaced from their cities of birth, and why they're touted as a "disruptor" in this very brief.

The end game for these unicorns is to become the cash hoard that they intended to compete with.

echelon1y ago· 2 in thread

> Let’s not pretend that YC and other VCs are noble.

I'm fine with that. Let them make money at the expense of big tech.

Big tech already won. It's benefactors already reap the benefits. Break them up and a new generation of engineers can grow wealthy on the field they contribute their labor to.

scarface_74OP1y ago

They do see upside - by being acquired by BigTech.

And engineers are getting wealthy - by working for BigTech. Even an entry level developer at BigTech makes more than 90% of workers.

echelon1y ago

That's a low ceiling.

1 more reply

j / k navigate · click thread line to collapse