| Outperform on what? Different structures yield different results. Venture backed startups produce results different to internal R&D departments, for example. Open source/open culture projects yield different results than typical startups. I don't think a VC fund would have invented the internet, not in the 60s. I don't think the worldwideweb could have been invented by a typical corporation. If it had been, it would have been more like facebook than the www. America Online and others were attempts at a proprietary FB-esque www. The web would have been different if they won. Linux is different from Windows. Different types of organisations make different kinds of things. If we only have one type of organisation, we limit the possible outcomes. The vast majority of current VC success stories are neither here nor there in terms of public benefit. The next tiktok is a great return for VCs, but consumers are not likely to lack for social networking innovations either way. I think this is a sign of overinvestment in one category. They're fighting over the pie, more often that baking it now. This wasn't the case circa 2005. Funding structure and organisational structure are kind of similar for these purposes. Tesla's uniqueness is another case in point. Musk funded it himself. There isn't really a type of financing, besides self financing, that could have done that. Banks and hedge funds don't want high risk projects. VCs don't want projects that require lots of funding once successful. Despite being a superstar CEO, Musk's initial investment diluted him from 100% to nearly 0 at one point. Technically, the shares that he owns were earned back as CEO performance bonus. Not attractive to a VC... compared to a facebook. I doubt that Tesla is the only such project possible, technically. Funding structures just make it less likely. In much of the west (UK certainly), our economies have gotten very intangible. Software, Banking, financing, entertainment, patentable tech. Some of this is because the world presents those opportunities. Some of it is because of financial structures. We have bigger/better financing structures for some things more than others. Silicon Valley developed a unique economy based on a pretty unique web of financiers, angels and VCs. All that said, I have no idea if this agency is good/useful. Sounds dubious, honestly. |