Funding Innovation: Difference between revisions
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(Created page with "VC funding means scoring big on a few winners. In such a case, investors become owners. They do not build the business, but are enabling, parasitic costs. It will in general b...") |
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VC funding means scoring big on a few winners. | VC funding means scoring big on a few winners. Investors become part owners. There are fund managers and limited partners providing the cash. They do not build the business, but are enabling, parasitic costs. It will in general be unfair - losers ride but can be killed, and winners make a killing. | ||
Banks would fund low risk, if there is security/collateral. VCs fund risk. And that means that with partial ownership (dilution) - investors make it big year after year. | |||
Revision as of 19:55, 2 July 2022
VC funding means scoring big on a few winners. Investors become part owners. There are fund managers and limited partners providing the cash. They do not build the business, but are enabling, parasitic costs. It will in general be unfair - losers ride but can be killed, and winners make a killing.
Banks would fund low risk, if there is security/collateral. VCs fund risk. And that means that with partial ownership (dilution) - investors make it big year after year.