2.0 WWE : MBA-ManChild vs Serial Pest vs 21yr GenY
Hehe, the latest tech-meme'd NYTimes piece on Web 1.0 vs 2.0 has nice language I enjoy on a Saturday morning : Even if it does insert some placeholder "facts" from unnamed sources, but by the second and third act, reassures East Coast paper readers, that their google shares will be OK. The intro paragraph is still fun.
"THIS may seem familiar: A pair of venture capital firms agree to pay $26 million for a modest-size stake in a start-up that has yet to earn a penny. A third plunks down more than $12 million for a sliver of a company started by a college kid so young he cannot legally be served at a bar. Certain businesses attract attention — say, online photo sharing or alternative energy or security — and soon it's off to the races as entrepreneurs crank out instant business plans and the venture capitalists, anxious to say they have a "play" in a particular "space," fall over themselves financing every last copycat company."
The article then shifts gears to bring a voice of serious and diligence by trying to hang out to dry the 2 dimensional cliche of the serial entrepreneur or the "MBA Man Child" (which is a hilarious stereotype but I find they are around alot less, the Masters of Man Child Business School, than the 1.0 epoch. (they now - want to - work in private equity instead where money is 5-20 times better : "Infrastructure is the new Internet. I Want to Work in Infrastructure. Buy Nuclear Energy Plants from governments and shit, then sell them onto public markets and take huge advisory fees, and my bonus is like $12m on a $8m base, its alot fkg better than trying to turn eyeballs into gold." )
What I do find (which is reflected in our team) is there is a demo-gulf (only agewise) between the 21/22 year olds who are fresh and brought up with IM/SMS/ADSL/WIFI and the 30+ serial white collar exec set. As always getting the right combination of youth and experience is key ; As Melbourne had last night when it beat the Hawks is key : Melbourne had 8-10 players that hadnt played 50 games, but had alot of 100 game plus players too:
"Nowadays, according to an informal survey of venture capitalists, they typically spend a couple of months doing due diligence before investing in a start-up. Every once in a while, they say, they might cut a check within a couple of weeks of learning about a potential deal — but that's if they have been presented with an enticing opportunity to invest in a nifty money-making idea being peddled by a set of serial entrepreneurs, rather than a me-too scheme packaged by a group of man-child M.B.A.'s, none of whom have a convincing plan for how they might one day turn a profit."
"THIS may seem familiar: A pair of venture capital firms agree to pay $26 million for a modest-size stake in a start-up that has yet to earn a penny. A third plunks down more than $12 million for a sliver of a company started by a college kid so young he cannot legally be served at a bar. Certain businesses attract attention — say, online photo sharing or alternative energy or security — and soon it's off to the races as entrepreneurs crank out instant business plans and the venture capitalists, anxious to say they have a "play" in a particular "space," fall over themselves financing every last copycat company."
The article then shifts gears to bring a voice of serious and diligence by trying to hang out to dry the 2 dimensional cliche of the serial entrepreneur or the "MBA Man Child" (which is a hilarious stereotype but I find they are around alot less, the Masters of Man Child Business School, than the 1.0 epoch. (they now - want to - work in private equity instead where money is 5-20 times better : "Infrastructure is the new Internet. I Want to Work in Infrastructure. Buy Nuclear Energy Plants from governments and shit, then sell them onto public markets and take huge advisory fees, and my bonus is like $12m on a $8m base, its alot fkg better than trying to turn eyeballs into gold." )
What I do find (which is reflected in our team) is there is a demo-gulf (only agewise) between the 21/22 year olds who are fresh and brought up with IM/SMS/ADSL/WIFI and the 30+ serial white collar exec set. As always getting the right combination of youth and experience is key ; As Melbourne had last night when it beat the Hawks is key : Melbourne had 8-10 players that hadnt played 50 games, but had alot of 100 game plus players too:
"Nowadays, according to an informal survey of venture capitalists, they typically spend a couple of months doing due diligence before investing in a start-up. Every once in a while, they say, they might cut a check within a couple of weeks of learning about a potential deal — but that's if they have been presented with an enticing opportunity to invest in a nifty money-making idea being peddled by a set of serial entrepreneurs, rather than a me-too scheme packaged by a group of man-child M.B.A.'s, none of whom have a convincing plan for how they might one day turn a profit."
posted by redbarren at 12:36 PM
5 Comments:
Private equity will for the most part be more profitable than venture capital. This is because in PEQ you know what you are dealing with, where as in VC you are dealing with smiles and soap.
In v1.0 world, the insane valuations given for smiles and soap made it more sexy than PEQ.
Eventually a fairly good portion of the v2.0 hard asset PEQ folk are going to get burned by over paying for very capital intensive assets.
well the economists did always worry the new economy would move towards a "perfect" socialist economy with perfect information and market transparency hence low margins ala Amazon.
while in private equity - basically complex mathematics of :
- buy low sell high..
seems the opposite of private equity and makes alot more sense as a career choice.
although in a hedge fund, u have less regulation and can make bets going down too, not just up... :) bb
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