[rovek]

Nothing soured my (already negative) opinion of Crypto as much as regular conversations with a Crypto VC. Every time we spoke they were either sceptical or very excited about something that, to me, was obviously a trivial example of 1 or more classic scams. Whether or not they were excited about it didn't seem to track with the scamminess.

[vidarh]

When I did my second startup and first to get proper VC funding, we were young and stupid and got talked into changing strategy because the VC, while not going for an actual scam, was very clearly thinking we could win a game of musical chairs that necessarily would end badly - this was a the height of the dot-com boom, and they wanted us to chase signups over revenue because per-user valuations were way out of whack with what there was any reasonable hope of earning from users who had signed up for a free service.

Their hope was we could exit before the music stopped (we didn't; we survived, barely, thanks to mostly sheer luck of having closed our B-round weeks before the bubble burst, and managed to pivot and survive with massive cuts). We still hoped we could make it profitable without that, but there was no way we could generate enough revenue to justify the exit we were hoping for, but the proportion of our budget that went to marketing certainly made achieving profitability much harder.

Which is to say that VC's often chase very high-risk ways of getting growth even in cases where they know it's just a question of time before valuations will collapse, because most of them are in the business of producing returns, not sustainable companies, and many of them are "dumb money". It's a tough business. I spend a few years in one, analysing the track records of other funds among other things, and I saw so much stupidity in that dataset.

[satvikpendem]

> Which is to say that VC's often chase very high-risk ways of getting growth even in cases where they know it's just a question of time before valuations will collapse, because most of them are in the business of producing returns, not sustainable companies, and many of them are "dumb money". It's a tough business. I spend a few years in one, analysing the track records of other funds among other things, and I saw so much stupidity in that dataset.

This is a highly logical approach by VCs simply due to their business model of only needing one hit out of hundreds to make a positive return. Reading a recent article called Why You Shouldn't Join YC [0] was quite illuminating with regards to this fact. It is the ergodicity that kills most startups, which is exactly what VCs capitalize on. Personally, most of the counterarguments in the HN thread do not move me, of course a startup might pivot but they need not do it based on the VCs' insistence.

[0] https://news.ycombinator.com/item?id=37869760

[fsloth]

That’s sort of general problem with people regardless of industry who’ve drunk the startup coolaid … wrong way around, let’s say. The point of innovation is not to reinvent the wheel. Saying you are startuppy does not excuse you from actually learning about the field. One could even radically propose knowledge of field helps to find innovations. What one should avoid is saying ’no’ just because such a thing does not exist yet. If the thing exists, has a name like ’Big Bad Mistake’, you should at least acknowledge it. (Yeah yeah, rockets were impossible and Musk beat them but that happened via respect of existing art and extending it, not completely ignoring it).

[huehehue]

What soured my opinion was everyone and their dog trying to explain to me how they were going to get rich with bitcoin and NFTs.

And this was when I was actively employed developing crypto finance instruments! Like, I have warned people not to buy the thing I have built because they did not understand it.

It is/was a great playground for modeling different instruments imo, but people don't want to treat it like the back alley casino it is.