In Silicon Valley, angel investing has become a key form of social currency | Hacker News Reader

In Silicon Valley, angel investing has become a key form of social currency

bloomberg.com

33 pointsimartin2k16 comments

The lives of these wealthy individuals are so devoid of love and focused on money, they literally have to purchase friendship. How sad.

The wealthy didn’t become wealthy by making the same micro everyday trade offs others did. I’m not saying they are not talented, they are, just that they some times take roads commoners wouldn’t want to. In any case, the rich just don’t use other people - they get used up too. That’s why capitalism is great, and how it works for more people than it appears.

Can’t tell if this is ironic or not.

If you can't tell you might be a commoner

Hard /s

In my experience, people undervalue community and trust. What this article is describing is not that different than what my parents’ diaspora did when they immigrated to the US via chain migration. They had a tight knit community in the origin country, but were not wealthy.

What they did have was trust. So if a new immigrant got a visa call, and they came to the US, people in the community, distant cousins, close cousins, friends of friends would not hesitate to send $2k, $5k, $100, whatever they could to help them get their business started. Today, the same people send each other $100k+ to close deals without hesitation.

Obviously, no bank is going to lend to a no name immigrant. And they were not going to get fancy white collar jobs or even government jobs with broken English and no US degree.

I see the people in the article doing sort of the same. They are taking advantage of the trust between each other. Why let a bank or other investor take extra if you already have the inside scoop that this person is likely not a fraudster and has good work ethics?

A less cynical way of looking at it is that they are waking up to the goodness of sharing their wealth, carefully?

This is extremely overly cynical. The angel investors I know grew up in lower social strata, were extremely passionate about computer science and very dedicated to both careers and friends. Their angel investing goes towards social good like businesses working on fresh drinking water.

The ones I know at least feel incredibly fortunate and lucky, know that the world is terribly unfair and that they essentially won the lottery. They put a lot of time and energy into helping others and now that they're comfortable they are making sure they're working on impactful projects.

This is the kind of environment that I've seen here in the bay area in several different areas that leads to success. It's less about an individual startup but more like a little ecosystem of interrelated but different companies helping to build a new industry.

If you go out for drinks with a friend and you buy that friend a $7 beer, are you "buying friendship"? What about when they buy a round? The question to think about is how much is $10k worth to you? If you've already got money stuffed into index funds, 401k, Roth, along with some off the wall investments, and you've got your ears open for something that might beat the market in 10 years, an angel investment opportunity for $10k really isn't that much money.

It's a different financial strata than most live in these days, but to think of it as purchasing friendship is to misunderstand just how rich some people are, and how the bubble they live in operates.

Unpaywalled https://archive.ph/2022.09.29-164440/https://www.bloomberg.c...

In my experience this is limited to a very select social strata. Much of Silicon Valley are worker bees who code for food and shelter for their families and don't go far beyond that.

"Sometimes they ask her if she wants to put money into their companies."

- IMO a founder shouldn't ask friends this. If your friends believe in you, they'll go out of their way to ask & invest.

"The fact that they are my friend means there’s something cool and interesting about this person"

- No, not all friends are bc of tech/career. Even with many friends in tech, the % I'd invest in is low.

"Investing in my friends is super cool,” she says. “I get to support them"

- Totally agree. Supporting friends who you believe in is fulfilling and an end in itself.

"To me it’s very similar to Instagram. You follow each other. The only difference is it costs $10,000 to follow someone, and to create a profile you have to start a company. This money-friendship overlap reinforces the clubby nature of a lot of aspects of the Valley"

- Mmm. No. You're likely keeping up with them anyway bc they're smart, driven, inspiring to be around. - "Clubby?" - founders are rare. Also, as an investor you enjoy the same hobby - business. It's not as elitist / exclusionary as that comment makes it out to be.

I've seen this in all industries, not just startups in the Bay area. Above a certain level in companies proples personal lives and work life's are intertwined and inseparable. These people tie their self image, self worth, and entire life to work. Once your like that, you have no way to interact with the world and other people other than through the eyes of business. Every meal, mixer, person you meet is a potential new business asset to leverage in the future. Their entire world view is different.

Always great to start my morning with dystopian hypercapitalism. Thanks, HN!

Interesting bubble

What the hell ……

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