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by bello 4261 days ago
It's different because this time it's VC money, not people's savings.

When a company is listed, the stock price better reflect the actual market value of the company (otherwise a dot-com bubble happens). However, if rich VCs like to bet on startups, that's expected to be a high-risk investment.
3 comments
davidw 4261 days ago
The Dot Com bubble was VC-fueled too. Probably more so than this go-round, because it took more capital to start most kinds of companies back then.
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bhouston 4261 days ago
> it's VC money, not people's savings.

Well, technically VC money is people's savings, usually parts of pension funds I believe.

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lmm 4261 days ago
A little of it is pension funds or sovereign wealth funds, but most of it is from high-net-worth individuals. Investors are required to be financially sophisticated; they know the risks they're taking.
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smt88 4261 days ago
If VCs lose all their money, it won't be anything new. Only a tiny fraction of VCs provide a return, after you take out the managers' fees. Large firms pump money into VCs almost charitably or as a PR thing -- they rarely expect much out of it, and their portfolios certainly aren't made or broken by their VC bets.
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