Venture capitalist Bill Janeway cites industry data when explaining why early-stage startups increasingly focus on M&A over public listings.
Prediction Not checkable as stated
Janeway: Non-traditional late-stage tech investments will end in painful correction
“Now, when you see investors, hedge funds, mutual funds, paying premium prices, To buy illiquidity, to buy securities with no liquidity and with no governance rights. In the private market. The only thing you know is when it ends, it will end painfully.”
Insight
Janeway: Low launch costs make spray-and-pray seed investing rational
“This means, on the one hand, a step function increase in the number of startups, in the number of Darwinian hopeful monsters. Most of which will fail. Most of which will fail Pretty fast, and without costing an enormous amount of money, so that at the front en…”
Prediction Not checkable as stated
Janeway: Startup Quality Inevitably Declines When Cheap Capital Is Plentiful
“Again, the people on the other side of the market aren't morons, so the quality inevitably will decline. Inevitably.”
Insight
Janeway: Cash and control are the only hedge against startup uncertainty
“The central theme of the whole first half of my book is that there's only one way to hedge against uncertainty in venture startups. You don't have credit default swaps. You know, you don't have instruments that you can buy to hedge your position. It's two word…”
Insight
Janeway: Venture capital functions as distributed R&D for incumbent corporations
“Well, what I'm saying is that because getting public is so difficult and so rare for venture-backed tech companies that, practically speaking, we should be thinking about that what we're doing is funding distributed research and development for big companies.”
Insight
Janeway: VC funding fundamental science instead of technology commercialization is dangerous
“I mean funding science. Rather than funding, funding the commercialization of technology and finding commercially valuable new innovative applications of technology.”