On: The Knives of Class Warfare Turn Towards Tech’s Plutocrats

[ryguytilidie]

I don't think the OP doesn't understand this, I think hes simply arguing that the person putting up the money to do amazing things should get less of a return than the person DOING amazing things. Unfortunately that is not the case at the moment.

[kkowalczyk → ryguytilidie]

Unfortunately how?

Amazing person doing amazing things has an option to not take the money and have 100% of the upside of his amazingness.

What people seem to forget is that it's about risk.

VC investing is high risk. For every 10 investments, 1 is wildly profitable and the other 9 are failures or low returns.

For that reason the ROI for that 1 out of 10 success cannot be "fair" by your metric - VC has to make enough to cover the 9 losses and some profit.

What the amazing person gets from the deal is knowing that even in the likely 90% case of failure, he won't sink in debt to fund his work.

[legutierr → kkowalczyk]

Venture capital investing is not the only method by which to mitigate the risks inherent to innovation. The university system, via tenure and grants, does a good job of facilitating innovation by mitigating the risks that individual researchers take--even when big capital expenditures are required.

Other systems can be envisioned: for instance, a basic income or a negative income tax would remove much of the risk that individual programmers, inventors and tinkerers face when trying to pursue their visions.