VC is like Soviet Statism

VCs do everything you would expect the USSR would do, while being a private company.

VC

Financing projects without asking too many questions. Sometimes people refer to this as VC welfare. If a company puts the right combination of “disruptive”, “blockchain” and “AI” in their slides they receive funding. Showing some APIs, an app with users (real or fake) the money flows him.

With no real technical evaluation.

USSR

Financing projects without asking too many questions. Sometimes people refer to this as Social welfare. If a company puts the right combination of “surplus”, “proletarians” in their presentations they receive funding. Showing some building, a product and have employees (working or not) the money flows him.

With no real technical evaluation.

VC

They gain ownership forcibly. In exchange for money, for the bet they gain equity (this doesn’t always have to happen, when a bank gives you credit it doesn’t become a partner). In this way if the company becomes a “Unicorn”, the equity value increases so much that it covers the losses from the other failed startups, that got money, but failed.

USSR

They gain ownership forcibly. In exchange for money, for the bet they gain equity (this doesn’t always have to happen, when a bank gives you credit it doesn’t become a partner). In this way if the factory becomes an “Example for the nation”, the *five year plan would increase so much in value that it covers the losses from the other failed factories, that got money, but failed.

VC

After this financing operation the VC doesn’t check their investment too much. They just follow the Blog for announcements, but not really understanding what the startup is really about they set a time frame for the investment to generate “returns” or either exit or go public in case of success.

USSR

After this financing operation the State doesn’t check their investment too much. They just follow the Public Commisar for announcements, but not really understanding what the factory is really about they set a time frame for the investment to generate “returns” or become an example for the country in case of success.

VC

There is no evalutation of the technological value of a project, not even of its feasability. Theranos, for example promised something that anyone that has spent 5 minutes in medical research lab would find impossible. The results were fake. But no one really experimented the technology with indipendent scientists BEFORE investing. And also when researchers talked, they were ignored.

USSR

There is no evalutation of the technological value of a project, not even of its feasability. Lysenko, for example promised something that anyone that has spent 5 minutes in a agrarian biology lab would find impossible. The results were fake. But no one really experimented the technology with indipendent scientists BEFORE investing. And also when researchers talked, they were ignored.

VC

No one looks at the CV of the founder of a Startup. Neither the industry or academic experience count. It’s not particularly important to have worked in similar companies or holding a degree. What counts is being part of “the Silicon Valley culture”, even a disastrous past is ignored because of a positive “failure culture”, the idea that a failure is testimony of courage and of a risk taking attitude.

USSR

No one looks at the CV of the founder of a factory. Neither the industry or academic experience count. It’s not particularly important to have worked in similar companies or holding a degree. What counts is being part of “the Communist ideology”, even a disastrous past is ignored because of a positive “failure culture”, the idea that a failure is testimony of heroism and trust in the Communist system.

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