This is a very truthful article and one that should bother a lot of people
The stock market and investors "immediateness", and all the other points.
3B dollars can fund a (small) semiconductor company. And they're going for a picture sharing app (different, but worse - as in, a quirk - than Instagram)?
Can 3B dollars fund a small semiconductor company that will have a sustainable competitive advantage against Intel, AMD and TSMC? My guess is NO. Successful picture sharing apps has stable audience locked in with network effects and switching costs. That is a sustainable competitive advantage.
Why are you assigning some sort of 'perfect knowledge' or clairvoyance to VCs ? They are just like everyone else and they make irrational decisions and have inherent biases.
I didn't assign anything. You did. Stop putting words in my mouth.
My point was that if a random HN commenter is able to raise some issues about ROI of various investments then certainly VCs who do it professionally have these issues factored in. Simple as that.
Start being clear, then people might understand your confused responses.
> then certainly VCs who do it professionally have these issues factored in.
What is so certain about it? Doing something 'professionally' just means that its your job. People are capable of sucking at their job (which happens far too often IMHO).
> Can 3B dollars fund a small semiconductor company that will have a sustainable competitive advantage against Intel, AMD and TSMC?
Semiconductor does not automatically mean CPUs for the consumer market. 3B can fund a small, very profitable semiconductor company, with well-defined expertise in an important, current problem (e.g. power management, low-power RF communication etc.) from which it can grow onwards.
Unfortunately, this market is less volatile and, consequently, less attractive for people who expect immediate returns.
The stock market and investors "immediateness", and all the other points.
3B dollars can fund a (small) semiconductor company. And they're going for a picture sharing app (different, but worse - as in, a quirk - than Instagram)?