![]() ![]() Around this one segment they are able to build their narrative in such a way that it seems that the topic holds water. Journalists have a tendency of showing just a small segment of a given topic and not showing the full spectrum. Naive journalists are easily fooled by the PR of VC funds Despite their best efforts to drill down into a topic, the end result is often less than satisfactory. Even science journalists are not always able to understand the issues at hand. Without deep knowledge of a given subject matter, it is almost impossible to capture something that is not false. Sophisticated discussions between "experts" play out across the pages. Whenever they read newspaper articles on the subject they end up pulling their hair out. It is impossible to simplify complex things by their very definition.įor example, some of our fund’s partners know about quantum computing. Any oversimplification – which is usually what journalists present – will always be false. If you know a thing or two about a specific industry, you will immediately be able to detect nonsense (read: bullshit) when reading Business Insider or Newsweek. Journalists are often superficial and unfortunately the oversimplification of complex issues helps them lose their essence. Most often the company in question is simply a 0 or 1. Any reference to past successes or average amount of returned capital is problematic because such quantification tells investors nothing. Of course, the better the fund, the better the verification of their idea, however this still doesn’t offer any actual credibility. The fact that a good VC fund gave a founder money simply means that a VC fund gave them money. There is only a rule that dictates that very few will succeed. Under such circumstances there are no similar paths or patterns that a startup can follow to achieve some sort of predictable success. The 90/10 rule says that out of ten startups, at most only one has a chance of success. In this world, a lot depends on the competences of the founder and fate. Does it already guarantee that they will deliver the results and the solutions as promised? Not at all. The status of being a tech company that has received funding ensures publicity and increases the chances of accessing subsequent investment rounds. ![]() But in most cases, the support they receive comes in the form of a one-time cash injection and ruthless enforcement of promised results. Occasionally it happens, like in a fairy tale, that they receive a magical gift in the form of uninterrupted support from their king. At the same time, they allow themselves to be shackled and agree to carry a heaven burden. They give away pieces of something that they believe in and have built with their own blood sweat and tears. They might be drinking champagne today, but tomorrow they should be crying. But the founder gave away 20% of the company's value for a measly million. If the founder creates a game-changing technology company, it could be worth $100 million in five years. Let's look at it from a founder’s perspective: media interest is piqued by the fact that they’ve given up shares of their company for money. ![]() Journalists love to write about startups that get funded The king gives a treasure chest full of gold on the promise that you will create a new world for him. The king does not promise half of his kingdom after the mission has been completed. The relationship between investors and founders is no fairy tale, although fantasy does play a large role. Investigative journalists, if you can still call them that, only uncover the truth for the highest bidders. Any problems – if they exist – are effectively camouflaged. PR teams working for startups and VCs are effective in fanning the flames. A VC is like a good king that gives away half his kingdom on a promise. They make heroes out of founders and they turn the growth of companies into a sideshow. The Media spins fairy tales about the world of startups. ![]()
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