
Presumed Abundance: Funding it Forward - jot
http://www.presumedabundance.com/
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3pt14159
First angel group I actually want to apply to. Not really for the money (I
have enough to bootstrap for more than a year), but because that is what I
want to do if I do make a profit anyway.

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nlwhittemore
My friend Kim put this together after a conversational epiphany. I'm really
excited to see how they make it work.

I'm also excited to see more HN types building companies that end up creating
social value - there is a lot of overlap between web startups and "social
entrepreneurship" IMO

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_delirium
Yeah, it seems like a pretty ingrained part of the hacker ethos, going back to
the 70s. The microcomputer revolution was as much about changing the world by
getting tech into the hands of ordinary people as it was about making lots of
money in the process.

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maxwin
Great job! I really love this idea of social investments.

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thesyndicate
Is this a pyramid scheme?

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_delirium
No more than VC in general is, I don't think. Making money on tech and then
re-investing that money into new tech is basically the whole premise of the
business. It does in a sense depend, like pyramid schemes, on a continual
influx of new money; otherwise VCs couldn't, on average, actually make more
than a 1x multiplier on their exits.

But unlike pyramid schemes, that not-yet-made money isn't actually promised
yet: the article didn't say that they're _already_ funding new startups with
their future profits, only that they decided that, _if they do_ make profits,
they'll use them to fund new startups.

Edit: Actually, the above comments make more sense when comparing to a Ponzi
scheme. Pyramid schemes are even less similar. A pyramid-scheme way of funding
tech startups would be: you put in $1000 towards funding the current round of
startups, and in return, get your name put on a list of startups that'll get
funded in the next round. The direction of money flow is different: in a
pyramid scheme, tomorrow's startups are funding today's startups, while in a
Ponzi scheme, today's startups are funding other startups of today with money
they don't have yet (which they hope to get from tomorrow's investors in an
exit). In a normal, non-fraudulent investment scheme (like this one), today's
startups will, in the future, fund tomorrow's startups, once they have the
money to do so.

