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Comment by gojomo | Hacker News Reader

I want to know who, by name or agency, thinks raising the 'accredited investor' thresholds is a good or necessary step.

Accredited investors aren't asking for this change. The participation of private investors (of any net worth) in regular equities was a non-factor in current financial troubles, or indeed any financial troubles of recent decades.

If lessons from the recent crisis are what's motivating new net worth requirements on investments, how about new rules to block submillionaires from buying homes? That's be more rational as a reaction to the mortgage bubble than blocking millionaires from investing in companies!

(I don't expect even lame-duck Dodd to tell average Americans they're too easily duped to own homes; we should be equally outraged he wants to tell millionaires they're too easily duped to make private equity investments.)

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Microsoft, Google, Yahoo, Apple, Oracle and all other large tech corporations benefit if the money to startups is cut off or diminished.

Getting rid of potential competition through legislation is a tried and true method.

Google uses startups for hiring inflow, I doubt they want to choke them off.

Starving startups of cash makes them easier to buy.

But it also reduces the number/quality of the startups worth buying.

Google uses startups for hiring inflow, I doubt they want to choke them off.

They do this simply because that is the only way for them to either get the talent of the startup, or get a competitor to start working on their behalf.

If the startup is successful, I doubt the founders would be particularly interested in giving it up without some compensation. If it isn't successful, then it doesn't matter, since Google will be able to recruit them for far less money once the startup is dead.

It is in every company's best interest to pay the people they hire below market rate for their work. The only benefit Google gets from this is that they know the people they recruit through acquisitions are capable of building things. It's a trade-off: is it better to acquire a company, knowing the people aren't losers? Or is it better to avoid having to pay market value, at the risk of picking up a loser every now and again?

Are you sure about that? Pre-IPO investment is a competition. There are hot startups and investors compete to invest in them. Beyond that everyone knows the early investors are the ones who make the most.

If I'm someone with a net worth of several million dollars and I'm viciously competitive I'd probably like these new rules because it forces people to come to me rather than to their Aunt Sally who has $100,000 stuffed away in a savings account somewhere.

That's a reasonable game-theoretic point -- and another reason why I'd like to know their names.

I think the famous investors now rallying against these new rules can meet the new limits themselves, but know the industry as a whole will be hurt if they lose their $1-2.5mil net worth angel peers.

So if there's some subset of angels who like this for non-positive-sum personal-advantage, let's out them. (There may be none; this could so thin the field of hopeful startups they lose far more in dealflow than they gain in lessened competition. But let's see.)

See SamAtt's comment on other reasons "famous investors" are against this; the new net worth limits are arguably the least worst part of this, depending on how viciously the other parts play out.

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