[dimaggiosghost]

The problem is it's impossible to predict success in an early stage company. Optimal way to ensure profit is to place many bets and hope one pays off enough to cover the costs of the losers. Asymmetrical outcomes are a requirement for sane strategic investors.

If all you can do is buy lotto tickets, you are better off buying insane payoff opportunities than trying to pick which lotto tickets will have a higher frequency of payoff, but a much lower yield.

[pm90]

The point though is that these are not really lotto tickets. A lot of high-tech startups are working on monetizing some obscure technology, or inventing a more efficient way to do a task, or something along those lines. They are actually providing value, other than the payoff from their sale or IPO. I think we as a society are failing somewhat to give an appropriate monetary value to that kind of contribution.

[TheHegemon]

The problem is that a VC doesn't care how much value a product provides to society. It only cares how much value it can extract for itself.

[flamedoge]

some VCs do look at what non monetary value their investment generates. I.e. Reddit.