Fundamentally, venture capital is the business of identifying & believing in ambitious people who need someone to believe in them. The greater the extent to which they're underestimated, the more you stand to gain — why is this *never* articulated?
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Not to say that VC works perfectly... but if it systematically fails to identify certain kinds of value, that’s a massive exploitable opportunity conferring rewards proportionate to the egregiousness of the systemic error
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In other words, “the idea seemed crazy so they ALMOST couldn’t find funding” is exactly what you should expect to see if the system *is working*
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If you believe both (a) good entrepreneurial ideas matter & (b) VC is systemically biased in some direction that makes it a poor evaluator of ideas, you should predict that a fresh team is about to come in & wipe the floor with the good ol’ boys
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Replying to @webdevMason
Not necessarily. What if the knowledge that the bias isn't true isn't yet known to anyone in the VC culture?
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I expect that this happens all the time, and the corrections just aren’t super obvious most of the time. (Like, if someone just made an exceptional amount of money, that’s almost *necessarily* a correction?) What you shouldn’t expect is for ignorance to be stable
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