Innovation/Large Exits

I think large exits are toast. The narrow focus is stifling, the incentives misaligned and the concentration will eat itself.

I think that’s what the sudden concern with fractional reserve banking is suddenly about.

By doing the headless chicken act they’re probably speeding up the outcome they all have been trying so hard to avoid. Digital dollar and a fed account for all Americans

In the context of venture capital, a “large exit” refers to a significant return on investment for the investors. Typically, this means that the company has gone public or been acquired at a high valuation, resulting in a substantial profit for the investors. The goal of venture capitalists is to identify startups with high growth potential and provide them with the capital and support they need to scale quickly and become valuable.

However, the focus on producing large exits has its downsides. It can lead to a concentration of funding in certain industries or technologies, and the prioritization of short-term gains over long-term benefits for society. Startups that do not fit this mold may struggle to secure funding, even if they have the potential to make a significant impact. Additionally, the pressure to achieve a large exit can result in companies prioritizing growth at all costs, even if it means disregarding ethical considerations or the well-being of their employees or customers.

In recent years, there has been a growing realization that the hundreds of billions of dollars deployed each year by venture capital firms in pursuit of “innovation” have not necessarily made the world a better place. Despite all the talk of unbridled innovation, venture capital services only promote specific types of innovation that promise large returns on investment with relatively low risk. This has resulted in a situation where some of the proudest accomplishments of venture capitalists have not necessarily contributed to society’s betterment.

This has led to situations where some of the most successful ventures in recent years have been those that seek to minimize labor costs while monopolizing their respective sectors, such as AI and the gig economy. While these technologies have undoubtedly brought some benefits, they have also contributed to the precarization of work and the erosion of workers’ rights. In the case of the gig economy, for instance, workers are often classified as independent contractors, depriving them of benefits such as healthcare and sick leave.

Another area where venture capitalists have been successful is in the creation of infrastructure for speculating on digital assets, such as cryptocurrency and the metaverse. While these technologies have the potential to revolutionize the way we transact and interact with each other, they also have the potential to commodify more and more of our daily lives. This could have negative consequences for our privacy, autonomy, and freedom.

Finally, venture capitalists have also been instrumental in the militarization of public space and the bolstering of police and military operations. This is particularly concerning given the increasing use of technology in law enforcement and military operations. Some of the technologies that venture capitalists have funded, such as facial recognition and predictive policing algorithms, have been criticized for perpetuating biases and contributing to the criminalization of marginalized communities.

There are already signs that some venture capitalists are starting to take this approach. Impact investing, for instance, is a growing trend in the industry, where investors seek to fund businesses that have a positive social or environmental impact. Similarly, some venture capitalists are beginning to focus on funding startups that prioritize diversity, equity, and inclusion. These are positive steps in the right direction, but more needs to be done.

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