Perpetually Private vs. Globally Public
Why companies are staying private forever & why communities should go public from the very beginning of their formation—you need to share the upside with the general public to get a global reach, fast
One of the many things that really irks me is the inaccessibility of technology equity. If you want to back some of the best startups in the world, you used to have to be where I live: Silicon Valley
Why is that? A simple answer: Equity density.
There is nowhere else in the world that obsesses over equity more than Silicon Valley. It defines the fastest growing companies and enriches teams. Investors are desperately trying to find the next growth engine and then “close the round”. They have closed off access to as many people as possible.
In this fireside chat with Mike Moritz—one of the greatest venture capitalists of all time—his Stanford-funded interviewer seems to relish this idea:
“Companies can stay private in perpetuity!” he exclaims, as if this is some kind of success. It is absolutely abhorrent. Here is the full discussion:
The IPO is dead & so are shares
This Vox interview from 2014 with Marc Andreessen explains why the public markets are now used by venture capitalists at the very last moment necessary.
Twenty years ago, IPOs had gotten democratized. You had Microsoft able to go public at less than $1 billion valuation. If you invested in Microsoft's IPO and held you had the prospect in the public market of a 1,000-times gain. There were a whole bunch of other comparable situations over the years.
Basically that all started to change after 2000. A whole set of "closing the barn door after the horse had run out" kind of things happened. Sarbanes-Oxley happened. The irony of Sarbanes-Oxley was that it was intended to prevent more Enrons and Worldcoms but it ended up being a gigantic tax on small companies.
The compliance and reporting requirements are extremely burdensome for a small company. It requires fleets of lawyers and accountants who come in and do years of work. It's this idea that if you control everything down to the nth detail, nothing will go wrong. It's this bizarre, bureaucratic, top-down mentality that if only we could make everything predictable, then everything would be magic, everything would be wonderful.
It is pretty remarkable that Mark gave this interview just after Ethereum launched. Little did he know but the solution would come from a Russian-born Canadian called Vitalik Buterin.
You will bend the knee to the ERC-20. It set the standard.
The ERC-20 token standard on Ethereum is eating the PDF-defined share system in America alive. The most interesting technology projects in the world are being instantiated on Ethereum instead of incorporated solely in Delaware. This is a profound shift.
If you stop earning overpriced equity and try to earn sensibly priced ERC-20s, you will do well in this coming decade. Finding the tasteful tokens is getting easier every month. You can do Discord diligence to figure it out.
Do Discord Diligence on Balance
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