Comment by HarHarVeryFunny
4 hours ago
I wonder how the investors feel now seeing what the initial product is?!
Maybe investing in all well-connected AI startups is safer than trying to pick the winners and losers?
4 hours ago
I wonder how the investors feel now seeing what the initial product is?!
Maybe investing in all well-connected AI startups is safer than trying to pick the winners and losers?
If you have N startups, and expect at least 1 of them to make >N times what you invest in each, then investing that amount in each one of them will still be expected to have a positive ROI. If none of them "hits it big" then you lose all the investment money, but if any of them grow enormously you profit. Trying to pick winners & losers in advance is much more difficult, investing in an entire business sector is the VC version of an index fund.
That's fine but none of them expected to invest 2 BILLIONS to get a half-backed IaaS product as the result. That would be fine if the investment had been $10M, but that's the math isn't mathing with that level of funding.
Exactly.