Ha ha oh man, sam. seriously: do you think about what you post at all before you hit submit?
you wanted to have a discussion behind closed doors before announcing this to the entire world? ok, that's fine, but that begs the question "why?"
given human nature, it's probably for nefarious purposes and propaganda control. I'm thinking you regret this bet, have realized it has only accelerate d the bubbles collapse, and are attempting serious efforts at damage control.
look, your a smart guy, sam, but you are pretty terrible at this whole communication thing, which is a shame considering that's a major part of your job.
Eh, I would be cautious, you might be getting played for publicity. If that's the case it wouldn't serve the purpose of the bet because the other side doesn't have any conviction about the outcome and only wants to raise their profile in the VC world.
$100k is probably cheap to get your name in many major news outlets.
The bet is a punctuation point on a discussion. Sam is already taking risk on current valuations, another $100K here or there isn't going to move the needle. The real stakes are reputation for prognostication. And the point to me is getting VCs on the other side of the debate to put a public stake in the ground, and hopefully give their arguments for why.
So I don't find this taker particularly interesting. In the context of an industry wide debate, the opinion of someone who doesn't have an audience similar to Sam's doesn't really mean much. Not that they aren't smart, just that they aren't someone influencing the discussion. Which is what this is mostly about.
And to say "I take the bet" without any discussion of why really misses the whole point.
Of course Sam should take this bet. But I'd suggest that he amend his proposal: Find people with enough audience to change the discussion, who are talking about bubble valuations, and ask them specifically to put a stake in the ground on this.
The bet also serves as an interesting hedge for anyone whose net worth is already heavily correlated with the success of the tech sector (which certainly includes VCs). 100k is not enough to really matter to a GP at a 500MM fund, especially if it goes to charity either way. But there are plenty of smaller VCs or even startup founders (including myself) who would do that deal not because they're skeptical of tech's fundamentals, but as a way to counteract exposure to an overall macro/tech downfall.
moving the goal posts? poor tactical decision, sam. you've just undermined your whole position.
before, with the open definition of VC, it expressed a high confidence in your bet.
now, by limiting the pool of potential bet takers, you are weakening your overall goal of maintaining public perception that there is no bubble.
the analogy is boxing. before, you were putting a huge bet that you were the best boxer in the world and you challenged any other boxer to challenge you so you could prove it. now that someone has, it's like saying that you are the best boxer in the world, and anyone can challenge you to prove it, except this challenger because reasons. it sounds like an excuse not to fight and makes you look scared.
it sounds like your confidence in your position concerning bubbles has been weakened, but you are trying to convince yourself it is as strong as ever by saying no REAL venture capitalist has taken your bet, so you must still be right.
I imagine he's interested in a bet with a big VC because they are the ones complaining about high, "bubble" valuations. I doubt Sam really cares one way or another if some random guy/the American public/whoever thinks we are in a bubble.
I know. sorry, I probably wasn't clear: it doesn't matter if he takes another bet or not, what matters is that he wishes that he would have had more restrictive requirements for who is able to accept his bet.
the logic being that, the more restrictive requirements, the less people who meet them, which means less probability that someone would take his bet, which implies that he never really wanted anyone to take the bet in the first place.
the subtext is that sam is not as confident in his position as he would like you to believe.
trye, but the importance of the two criteria aren't weighted the same.
plus he isn't doubling down on the same bet: he's changing the new bet to be more in his favor, so the additional 100,000 is actually worth less than the original 100,000. (not monetary value, but rather the money's value as representation of the strength of his belief that the bubble won't pop before 2020).
Pretty much everything a startup does is find resources that are underutilized and then utilize them for something outside their main purposes. If it is someone who's donating $100K to charity for publicity...well, that's a pretty neat hack, and one that everybody wins from.
The only thing I'm really interested in is why sama decided the other bettor had to be a VC. That's a pretty silly requirement.
Anyway this isn't a ballsy bet at all, really. Guys on 2p2 (poker forums) routinely make huge proposition bets that are more fun, interesting, and risky than this--occasionally for charity, as well (though not that often).
Losing this bet will likely do no more to either bettor than losing a $5 bar wager would do to me. Pony up the cash, shake victor's hand, move on with my day and forget about it.
I agree, this bet would make more sense if the other party was a hedge fund manager or someone else with a professional interest in being bearish on tech innovators. No active serious VC who's might have raise a fund or invest at a high valuation is going to bet publicly against the unicorns. Might as well just retire.
And since the $100k to charity would be tax deductible, it's really only circa half that for the publicity. But that too is not symmetric - if Sam wins it's more likely he will be able to put the deduction to good use immediately as he will have more gains.
The determination of "valuation" is pretty obnoxious. These preferred securities with liquidation preferences aren't even close to a "common equity" valuation. A VC round at $x valuation isn't remotely similar, economically, to a public co at $x valuation. This bet is more about whether the late stage VC bubble continues for 5 years than any notion of real value.
A bubble that never bursts is indistinguishable from real value. Remember that money is itself a bubble; its only value is that you believe other people will continue to accept it to give you the things you really value. The dollars in your pocket are just pieces of paper; the dollars in your credit card are even more nebulous, they're bits and bytes in your banks' computers. And yet somehow it's worked for thousands of years.
Plus, it's pretty likely that several of the companies listed will go public in the next 5 years, and then their valuation will be the public co $X. If that's lower than the stated figures in the bet, well, Sam will lose.
We ask about when they've done the impossible. You also get a pretty good feel for this after asking someone hard questions for 10 minutes. Not pushing back at all is bad, and pushing back too hard is also bad.