seed investors/VCs/etc are incentivized to discount public equity opportunities because they're trying to prove their own value to their LPs
Frankly, I have to wonder who is the audience for this post.
I had the same thought. My guess would be founders of "hot" companies. Altman is signaling that he knows all the ways to be a great investor (and presumably puts them into practice).
I plowed hundreds of thousands of dollars into startups that I wished I put in more "mundane" investments with better overall returns.
Startup investing is for those who seek:
* Some sort of personal glory
* Delude themselves into thinking it's a high quality investment
* Have had a one-exit "success" and now think they understand everything about everything
* Are in it for the philanthropy - building up "startup ecosystems". No, the next big hit will most likely NOT come out of Cincinatti or Indianapolis. Maybe the odd strike of lightning success, but there's no way to power an ecosystem with a few meager millions of dollars
* Are playing with other people's money
Angel investing is for the foolish or those with some sort of substantial inside edge / track on success that lets them beat the odds.
I don't see discussion of VC as a distraction any more than discussing bonds would be a distraction.
most people will never have access to the best seed investments anyway
10 years ago kids were not making $300k out of school
and this bull market is unprecedented
everyone looks like a genius when everything is up.
but yes enjoy it while it lasts, totally agree.
And hopefully the kids making 300k/year+ are smart enough to save and invest 50% of their income.
It depends on your goals. Private investing has much higher risk/reward.
The idea that you can’t find the risk reward is untrue. I’d consider investing in biopharma to be equivalent in risk reward to early stage startup investing. The difference is that these companies go public early because that’s traditionally the only way they can raise.
And if you want to rev up the risk to make 10x-100x you can options trade in the public market as well.
I mean, Nancy Pelosi of all people will make $130K in Facebook call options expiring this week. http://clerk.house.gov/public_disc/ptr-pdfs/2018/20010631.pd...
Similar risk reward, but it seems harder to have any insight into a pharma startup's chances of success. Sure, it is easier to gauge potential market (% of people affected by condition X), but whether they will be able to develop a product is a total dice roll.
you can look at things that an early stage investor looks at like team, hiring, etc. beyond just progress.
IMO this decade will be absolutely massive for biopharma. Plenty of good opportunities, especially for those complaining that the reward is public markets is not as high as early stage.
As an investor, I can make an informed option whether there is a market for subscription indoor cycles like an Peloton. I could be wrong, but I can look up the market numbers and weigh them against my personal experience and world view. When it comes to pharma, almost nobody has domain expertise of the subject.
To put it another way, the leading risk in tech is market adoption, while the leading risk pin Biopharma is technical feasibility.
I think there's at least a kernel of truth to the "myth" about public/private investing that you mentioned. You won't become a billionaire working as a software developer and investing in index funds for the next 30 years, but you can if you invest in the next Facebook or Google early enough.
That said, most tech people I know are looking to work at the next unicorn, not invest in it.