Comment by 6stringmerc | Hacker News Reader

Comment by 6stringmerc | Hacker News Reader

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The way you phrase this reminds me of what I studied happening in the hedge fund world, in that some of the 'top performer' funds only out-performed the market due to insider trading. Galleon (Raj - convicted), SAC (sanctioned), and probably a handful more that got spooked out of the avenue of enrichment. It almost seems - almost - like there may be a similar insular community whereby those who feel like piling in will only do so when it's a consensus movement play.

You know, kind of like how Bernie Madoff took hundreds of millions from established, regulated entities because the "word on the street" was he was, well, just front-running. Though illegal, that was an acceptable explanation for the consistent returns that prolonged a dirty business model. Well, we've learned how that all turned out.

Is there a moral to the story? Probably, but I'm not sure the startup culture would like to have to start questioning "angels" and their cohorts. YMMV.

There are people who willfully, knowingly invest in ponzi schemes, on the premise that they will try to get out before operator flees with the money because up until that point, it has outstanding returns.

There's an old saying that "you can't fool an honest man". Where did all the Albanians who poured their savings into Ponzi schemes think the crazy returns were coming from? Drugs. Where have a 419 scammer's supposed riches come from? Usually embezzled from Nigerian public funds.

You can't con a honest man.

You can certainly fool one.

It's fascinating to me that many startups put their crown jewels on github, a company with an inexplicably high valuation due to investments from some of the most successful VC companies. Don't they worry about exactly the kind of insider trading you're talking about, or worse?

Same goes for slack.

it is fascinating that people think most of the code from startups is crown jewels. If you look closely 99% of code is not hard to reproduce it is just time consuming to write but I doubt you will find some breakthrough ideas. Sure you might find some cool/impressive thing here and there but especially at early stages nothing there except number of hours put in. I know people tend to glorify things they write but mostly it is not that stellar achievement what they did.

If I was a VC assessing a firm, I would love to get a look at their git repository, and not just for due diligence. I would know where their demos are inadequate, which would be very useful for bargaining.

If you're a VC serious enough to start bargaining, you're going to have done a code audit already (whether or not it's on github) to validate claims.

The real value in these firms is not the code, but the employees' ability to execute on the entire business idea that their code supports.

"Crown jewels"? You mean a git repo? You know it's a matter of minutes to migrate between git repo hosting, right? :)

His point is that you're giving the VCs indirect access to your sourcecode, not that github would go belly up.

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