I love how it lists that a lunch with pg has an estimated value of $500. I'm sure that many in our community would gladly pay 10x+ for an hour of his advice.
When bidding more than the "estimated value", the winner can write off the difference between the value and their bid as a tax deductible donation. So that's one reason to not go too crazy with the valuation - a more reasonable market valuation can actually make the winning bid less expensive for the winner.
There is an amusing catch-22 here. In order to pay him what his advice is worth, it helps to have taken his advice so that you have that much money to spend on the advice. :-)
While I cannot hazard a guess to intention, a lowish estimated price is beneficial in at least two ways:
1) Put's more heads through the auction house door. One group could be searching for a bargain while another group benefits from increased perceived affordability (even if it ultimately ends up being illusionary). More bidders on the floor drive competition and maximize the closing price.
2) Allows others to feel the item is undervalued, and hence provides an opportunity for positive comment. If most said it was overvalued, that would create negative commentary and hence an undesirable perception of the brand (PG is this instance). If priced according to what the market roughly perceives as accurate, it generates less discussion, or action.
waaaait just a minute, you would pay five thousand dollars for an hour's worth of advice from paul graham (or anyone, for that matter)??? when i saw the price tag i thought, "shoot, must be a nice restaurant."
I can guarantee it will go for more than $500. If not to me for what I bid, then it will go even higher than what I bid... which is a secret. So no one bid $502, okay.
The other item: Galapagos Adventure for Two
(Item # 425, Donated by: The Altamirano Family, Hyre Family, Lau/Palihapitiya Family, Sandi Gedeon Ganjavi, Jennifer Winters, Est. Item Value: $3800) looks pretty fun, too, but probably less useful to a startup.
What would make more money: Paul Graham lunches everyday for a month at a lower price or limiting supply to 1 Paul Graham lunch at the coming auction price?
Here's an idea: PG, how about offering a lunch meeting to the HN member who makes the closest prediction to the winning bid? They would have to post it on HN and FB or something like that. This serves the purpose of helping advertise this worthy cause.
