Comment by khurs
4 hours ago
>Large decentralized infrastructure like the internet, DNS, email, and the web was largely built by VC-backed companies.
The poor need the rich to start a company as banks are prevented (by the rich) from lending to them.
The rich like VC as it's a tax write-off, they invest in VCs and get even more richer.
Most startups fail, the VC's investors get any leftovers and poor founder walks off empty.
>What about when things go wrong?
In general, if you lose money on an investment, you can offset that “capital loss” against a capital gain you have from something else.
>The poor need the rich to start a company as banks are prevented (by the rich) from lending to them.
no. the banks hold the poor's money, and it needs to do so without risk because the poor need their money. lending money to start companies that are completly unsecured is too risky for banks, they lend money to buy houses which is secured debt.
Banks lend against homes as the state guarantees the housing market is too big to fail and will bail them out.
Banks often lend at low LTV ratios because the prices are inflated so people on normal salaries can't actually afford to put down a large deposit, which means a slight drop puts them into negative equity but the banks are not concerned as they are protected.
If the state chose to underwrite startups in the same way...