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Comment by api | Hacker News Reader

Bonus theory #2: few IPOs means few newly minted angels.

Bonus #3: huge companies still sucking up VC like Uber are crowding out smaller investments.

I like to imagine that maybe Uber and money-losing ventures like it will help bring some balance to the universe by taking away the billions accumulated by super-rich investors and redistributing that money to working-class drivers through subsidies.

Like, I don't know: does all that red ink have a positive effect on the Gini coefficient?

(This pipe dream might not be supported by actual facts.)

I would argue the subsidies are going to the customers. The drivers, who often take out leases only to be surprised by Uber pricing changes, are often just treading water.

Karhoo is a more flagrant example - they allowed multiple referral codes per account, and people quickly circulated lists of codes that together came to over $100 in free rides.

In many cases, I expect customers are getting subsidized by both VCs and by drivers who don't have a good handle on their costs.

Regarding drivers who don't have a good handle on their costs, almost definitely. Mr Money Mustache just did a piece on this recently.

https://www.mrmoneymustache.com/2017/11/22/mr-money-mustache...

I buy your first one but not so much the second. People and funds investing in seed rounds aren’t putting money into Uber right now.

No but might Uber and similarly sized financing rounds be taking money from people who typically invest in seed/A/B? So those investors' funds flow away from the seed rounds? Just postulating.

Not really. These are completely different classes of investors, and different classes of investment.

Yep. A fund looking to deploy 8 or 9 figures a pop would not otherwise be putting that money into seed rounds.

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