
Across furtive videocons, junior VCs wait for the layoffs to begin - e2e4
https://techcrunch.com/2020/03/18/across-furtive-videocons-junior-vcs-wait-for-the-layoffs-to-begin/
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seibelj
Pre-2008 financial crisis we didn't have the iPhone, no app stores, cloud
hadn't truly taken off, and my graduating class of 4000 students had only 30
computer science majors. The 2010's were such a golden age for software
developers in terms of salaries, employers bending over backwards, never
ending funding, etc. etc. Many young tech workers are "children of the summer"
and never known any dark days. Although this will be painful, it will also
teach people a lot of lessons. A lot of weaker talent, sketchy business
models, and fast money investors are going to wash out and the industry will
emerge stronger.

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bdcravens
> A lot of weaker talent, sketchy business models, and fast money investors
> are going to wash out and the industry will emerge stronger.

Sounds like 2002. (In other words, been there, done that, got through it by
working for "boring" companies)

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rodgerd
It will be an unpleasant surprise on a lot of levels, ranging from the big -
job opportunities, salaries - to the small. One of the things that happened
both in 2002 and 2008/2009 was a sudden swing back to demands for suits, ties,
and so on. There are a _lot_ of people who resent their staff flexiworking,
wearing jeans, and generally acting like it's not 1962 any more.

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itronitron
>> There are a lot of people who resent their staff flexiworking

But that demographic is more at risk of dying from covid-19. The irony is that
they are more protected by everyone working from home and that their younger
colleagues will have more career opportunities if everyone comes into the
office and spreads it.

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rodgerd
People hating non-customer facing staff dressing like it's the weekend isn't
rational; what makes you think irrational behaviours are isolated?

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erik_landerholm
This article reads like a bad gossip rag but instead of being about failing
celeb marriages it’s less interesting.

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dehrmann
I miss Valleywag.

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pbiggar
> Third, and this is rarer, some funds have made loans or real estate
> investments using their management fee income as a way to boost the salary
> returns of the general partners.

They what?!?

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gumby
The management fee is just cash for the GPs and they can do with it what they
want. In theory it's to run their business until investments cash out but
notice how they always force the company they are investing to pay legal fees
(i.e. take it immediately out of the LP's new investment)? They just treat it
as their income.

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estsauver
The reason for this, that makes sense to me, is that there's typically one
lead investor negotiating terms and often many other following investors. If
the lead investor was the only one who was paying, then only the lead would
take the dilution.

If this is spread out among all investors, it's conceptually more fair since
the lead is negotiating for all of the investors effectively. At that point,
if you have a 50k legal bill, you can either say it's a 1M$ round where each
investor has to chip in their share, or you say it's a 1.05M$ round and the
company has to pay.

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gumby
Oh come on they can manage their own side of the fees. It’s merely petty
greed.

Also a $25MM round likely costs about $40K (combined) to do. So does a $5MM
round. Shameful. I always cap the total fees at $30K which pisses off the
lawyers but the VCs shrug.

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xwowsersx
Serious question, is this normal for TC or journalism in general?

> We are actively reporting this; feel free to reach out to me or other
> staffers at TechCrunch if you have tips here.

Seems wildly unprofessional/sloppy to me.

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pjc50
How else are reporters supposed to find this stuff out?

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u801e
A lot of articles these days source their material from various social media
posts. There are some articles where the vast majority of the content comes
from embedded Twitter posts.

