@glyph Did you quote post something?
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@glyph Isn't "Story 1" (small team, speculative product) the classic case for portfolio funding across multiple bets, perhaps in some product area where your investors have expertise?
When a bet fails or doesn't zoom upward, you know something more about the management and staff and whether you might want them on a new project, or perhaps you have a story for merging overlapping proposals to better cover a segment. (my previous employer was two start-ups merged by private capital and sold to a larger company as a unit).
Story 2 does seem like "too much capital, not enough investment staff and expertise" and it leans toward cornering territory rather than creating new value.
@jmeowmeow arguably the entire *point* of VC is to finance story 1, because public markets are supposed to be holding the larger pools of capital and financing story 2 with large, mature businesses.
But public capital markets have fallen apart due to a toxic combination of pervasive fraud and highly gameable regulation. Most capital is allocated in barely-regulated private market gambling now, which means there's too much money in those markets, which makes VCs unwilling to bet on story 1.
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@jmeowmeow arguably the entire *point* of VC is to finance story 1, because public markets are supposed to be holding the larger pools of capital and financing story 2 with large, mature businesses.
But public capital markets have fallen apart due to a toxic combination of pervasive fraud and highly gameable regulation. Most capital is allocated in barely-regulated private market gambling now, which means there's too much money in those markets, which makes VCs unwilling to bet on story 1.
@jmeowmeow What's happening with private markets right now is that when you're chasing story 2, what you're supposed to be looking at is the *existing unit economics* and scaling them up, with the benefit of extensive reporting requirements that allows sophisticated investors to evaluate the plausibility of that scaling, distributed across the processing power of the entire public market
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@jmeowmeow What's happening with private markets right now is that when you're chasing story 2, what you're supposed to be looking at is the *existing unit economics* and scaling them up, with the benefit of extensive reporting requirements that allows sophisticated investors to evaluate the plausibility of that scaling, distributed across the processing power of the entire public market
@jmeowmeow instead, we now have a version of story 2 where everything is made-up numbers on pitch decks that nobody needs to check. the dumb money is scrambling to get into these bets before they become "the next big thing" (c.f. my most recent blog post) and they're all scared they'll be left behind.
and "VC" is a bit of an abstraction here too, it's not just them, it's the whole system. a lot of the investment is just coming straight from megacorps as direct investment, no VC firms in sight
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@glyph It's funny reading this and thinking of all the "quantum applications" startups that VCs threw money at before belatedly realizing the absurdity of selling applications for devices that haven't been built yet.
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@glyph It's funny reading this and thinking of all the "quantum applications" startups that VCs threw money at before belatedly realizing the absurdity of selling applications for devices that haven't been built yet.
@xgranade that is the main lesson that quantum mechanics teaches us, isn't it? "time is a flat circle"?
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@glyph It's funny reading this and thinking of all the "quantum applications" startups that VCs threw money at before belatedly realizing the absurdity of selling applications for devices that haven't been built yet.
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@glyph I have been using Latest (https://github.com/mangerlahn/Latest) and it has been working pretty well. Doesn’t seem to cover all the apps I use though.
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@glyph Isn't "Story 1" (small team, speculative product) the classic case for portfolio funding across multiple bets, perhaps in some product area where your investors have expertise?
When a bet fails or doesn't zoom upward, you know something more about the management and staff and whether you might want them on a new project, or perhaps you have a story for merging overlapping proposals to better cover a segment. (my previous employer was two start-ups merged by private capital and sold to a larger company as a unit).
Story 2 does seem like "too much capital, not enough investment staff and expertise" and it leans toward cornering territory rather than creating new value.
@jmeowmeow @glyph Story 1 as written doesn't have enough growth in it. Venture investors will only invest in things that have the potential to grow rapidly and to a large size, otherwise their business model doesn't make sense. Most businesses aren't shaped like that so they need a different kind of funding. VC is only something like 5% of institutional equity investments so it's a small if extremely loud corner of the finance world.
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@jmeowmeow @glyph Story 1 as written doesn't have enough growth in it. Venture investors will only invest in things that have the potential to grow rapidly and to a large size, otherwise their business model doesn't make sense. Most businesses aren't shaped like that so they need a different kind of funding. VC is only something like 5% of institutional equity investments so it's a small if extremely loud corner of the finance world.
@mirth @jmeowmeow I appreciate what you’re saying here and it’s directionally correct (although I am super curious where you get that 5% number?) but you fell for my rhetorical trap :). the upside on story 1 is unlimited. potentially infinite. it’s an unknown innovation with an unknown market
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@mirth @jmeowmeow I appreciate what you’re saying here and it’s directionally correct (although I am super curious where you get that 5% number?) but you fell for my rhetorical trap :). the upside on story 1 is unlimited. potentially infinite. it’s an unknown innovation with an unknown market
@glyph @jmeowmeow Most companies don't have a reasonable chance of unlimited upside, or its implied consequence infinite net present value. If you look at a coffee shop, or a copper mine, or a CRM for dentists, you can reason about the business and come up with an idea of its financial mechanics and how it could be funded. Having been around a lot of small software companies I don't think many of them really have the growth potential to justify large outside investments.
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@glyph @jmeowmeow Most companies don't have a reasonable chance of unlimited upside, or its implied consequence infinite net present value. If you look at a coffee shop, or a copper mine, or a CRM for dentists, you can reason about the business and come up with an idea of its financial mechanics and how it could be funded. Having been around a lot of small software companies I don't think many of them really have the growth potential to justify large outside investments.
@glyph @jmeowmeow There are other fund structures that do these kinds of investments in some circumstances, Andrew Wilkenson's Tiny being an example that comes to mind, but it's a bit different than what VCs can do.
As for the 5%, it's a rough guess based on different numbers I've heard of different slices of finance. It depends who you count as "institutional" etc, and every fund manager has their own idea about how to allocate.
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@glyph Really enjoyed this, and a surprisingly optimistic outlook!
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@glyph @jmeowmeow There are other fund structures that do these kinds of investments in some circumstances, Andrew Wilkenson's Tiny being an example that comes to mind, but it's a bit different than what VCs can do.
As for the 5%, it's a rough guess based on different numbers I've heard of different slices of finance. It depends who you count as "institutional" etc, and every fund manager has their own idea about how to allocate.
@glyph @jmeowmeow As you can probably infer I have done a good bit of abyss-staring.
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@glyph
I do think we will continue to have innovation. A large part of why it has accelerated the past couple of centuries is IMO that we have enough surplus to afford having lots and lots of people working on research and innovation instead of providing nutrition to themselves.But. I agree that future waves of innovation are not going to happen in computing. We're petering out. It might not be in the hard sciences at all. And it might not generate big economic profits.
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@astraluma I don't think any of it narrativizes quite that precisely and neatly, and it depends exactly where you were and what you were doing at the time, but, in general, I think, "yes"
@glyph @astraluma Twice, arguably - in the mid 19th century slowdown, and the late 19th/early 20th century slowdown. (The industrial revolution had a couple waves, where new technologies got picked up, dramatically changed some industry/industries, then growth slowed down once they had become widespread, with
things like steam engines, trains, and telegraphs, early on, mass steel production, electricity, and standardized parts & assembly lines in the later wave) -
@glyph @astraluma Twice, arguably - in the mid 19th century slowdown, and the late 19th/early 20th century slowdown. (The industrial revolution had a couple waves, where new technologies got picked up, dramatically changed some industry/industries, then growth slowed down once they had become widespread, with
things like steam engines, trains, and telegraphs, early on, mass steel production, electricity, and standardized parts & assembly lines in the later wave)@glyph @astraluma but then damn near an entire generation died in a war, and shortly after did it again, so it's a bit less clear in that period what was "We ran out of new big things" and what was "We ran out of able bodied men to use the new things." until you get into the more contemporary period...
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@glyph I take him at the persona he presents to us, Big Joel™.
Comedy answer: Mike
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@glyph …you’re gonna make a blog post version of this, yeah
*puppy eyes emoji*
Gli ultimi otto messaggi ricevuti dalla Federazione
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Caso di studio sulla comunicazione politica. Ci sono video in cui il non detto fino a ieri pesa più di quanto detto oggi, poi ci sono video che all'apparenza sembrano chiacchiere inutili ma in sostanza ti fanno prendere pernacchie da destra e da sinistra, e infine ci sono video che gettano il marchio dell'ipocrisia sula persona che li mette in circolazione, sul partito in cui milita e le istituzioni che serve. E poi c''è Pina, che li riunisce tutti in un solo messaggio.
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@mora @quinta sarò ingenuo, ma io non credo che sia così. L'Europa è stata voluta altrimenti non si sarebbe fatta. Finora è convenuto più o meno a tutti, anche a chi fa guerra ibrida all'Europa (per poi in realtà mandare oligarchi a investirci dentro). Mettendo da parte l'Italia e le dovute fluttuazioni nel corso dei decenni, il tenore di vita medio in Europa è migliorato.
Nell'ipotesi peggiore, ovvero che l'Europa è solo un bancomat, beh, pur sempre meglio di niente. Chissa dove saremmo senza.
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@danmcd Wow!
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I think I need something like that
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@sdvsfr e come disse il ministro degli esteri Tajani ...ministro degli Esteri ma fino a un certo punto😁
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# New article is out #
Solus, a sparkling star in the Linux sky
https://darkblueraven.com/sites/articles/solus-review-january-2026.php
#darkblueraven #solus #xfce #budgiedesktop #gnome #kdeplasma #linux #linuxdesktop #opensource #freesoftware
