{"id":2060601,"date":"2017-02-12T11:57:41","date_gmt":"2017-02-12T06:27:41","guid":{"rendered":"http:\/\/stockviz.biz\/index.php\/?p=2060601"},"modified":"2017-02-12T11:57:41","modified_gmt":"2017-02-12T06:27:41","slug":"book-review-chaos-monkeys","status":"publish","type":"post","link":"https:\/\/stockviz.biz\/index.php\/2017\/02\/12\/book-review-chaos-monkeys\/","title":{"rendered":"Book Review: Chaos Monkeys"},"content":{"rendered":"

Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley<\/em> (Amazon<\/a>,) is a meandering story about one man’s startup journey. (Excerpts<\/a>.)<\/p>\n

Thoughts<\/h3>\n

The book is entertaining but it brought little in the way of added insight. The bit that stuck a chord was:<\/p>\n

\nMost VCs are playing a version of baseball in which the only way to score is to hit a home run when you\u2019re at bat. They don\u2019t care if you disgrace or impoverish yourself and strike out, and they don\u2019t care if you get a solid line drive that lands you on second. To them, strikeouts and getting on base are equally pointless, and so they\u2019ll push to proverbially \u201cswing for the fences\u201d no matter the count or the team you\u2019re up against.<\/p>\n

The reason for this all-or-nothing approach is how their funds are structured. VCs raise a fund, out of which they\u2019ll provision some number of investments. Barring doubling down on the same company, which they might do if the fund still has money when a company raises again, those investments are effectively \u201cfire and forget.\u201d The fund\u2019s total profit will be calculated from whatever those initial bets return. Unlike, say, a hedge fund portfolio manager, who rolls the winnings from one good bet into the next, compounding a series of returns into something truly huge, VCs do not take liquidity from one company\u2019s exit and pour it into yet another\u2019s. This, at heart, is why the go-big-or-go-home strategy makes the Silicon Valley world turn, and why entrepreneurs push themselves to be either the next Airbnb, or nothing. The entrepreneur who bucks this and creates a long-term business of recurring revenue but relatively slow growth is dismissed as running a mere \u201clifestyle business,\u201d which is a dirty word among VCs.\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley (Amazon,) is a meandering story about one man’s startup journey. (Excerpts.) Thoughts The book is entertaining but it brought little in the way of added insight. The bit that stuck a chord was: Most VCs are playing a version of baseball in which the only … <\/p>\n","protected":false},"author":2,"featured_media":2060611,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4023,9],"tags":[3751,3761],"class_list":["post-2060601","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-book-reviews","category-your-money","tag-book","tag-review","entry"],"_links":{"self":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts\/2060601","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/comments?post=2060601"}],"version-history":[{"count":0,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts\/2060601\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/media\/2060611"}],"wp:attachment":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/media?parent=2060601"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/categories?post=2060601"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/tags?post=2060601"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}