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Comment by wilg | Hacker News Reader

If any VCs who "invested" some of the $230 million into the dumbest product ever from obvious morons would like to instead invest with me, I'm pretty confident I can do better than a 0.5x return!

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It's not a 0.5x. It's much lower -- $230 million was the amount raised, not the valuation. It's closer to 0.1-0.2x.

The parent is right, investors would almost certainly have 1x preference, which means they get back the first $230M in an acquisition. The valuation doesn't matter if you exit for less than money in.

Founders and employees would get nothing out of this (aside from whatever HP is giving them directly as incentive to stick around).

That's the most interesting thing because if those folks managed to get a parachute for their 1x pref investors with this abysmal final price, what does it mean for the several companies at the same situation?

It's a pity that we do not have a version of "Who's holding the bag?"[1] for LP and VC funds, but with all challenges to raise money, it would be interesting to see how many funds are losing money at the moment.

This is the inherent feature from VC funds but still, one thing is raise cheap money and having a "circular" money flowing (from A -> B - (...) -> IPO -> A) but if they do not arrive even in the IPO how this ecosystem will work if a US 5 Year Coupon pays 4.40%?

[1] - https://pscmevents.com/wp-content/uploads/2023/03/Who-Is-Hol...

Are you sure? If given $230 millions what would you do and which AI product would you build, to generate $115 millions?

You’re kidding, right? In no way did Humane generate $115 million; they lost over $100 million. The list of ways not to do that is infinite.

Start with: an AI which emits a binary yes/no to, “Should I invest some of this $230 million such that it becomes $115 million 5 years from now.”

I mistakenly thought they generated a totally of $116 million in revenue.

I meant to ask "If you were to get $230 million, how would you plan to generate as much money as Humane was able to generate during the length of its existence". Do you have an answer?

> an AI which emits a binary yes/no to, “Should I invest some of this $230 million such that it becomes $115 million 5 years from now.”

If you were pitching that to me, I'd ask: what is the AI's confidence in its answer, and how can you verify that?

> how would you plan to generate as much money as Humane was able to generate during the length of its existence". Do you have an answer?

Humane generated negative $114M. They turned $230M into $116M.

My prospectus is to buy a $1M house, throw $1M parties every day for a month, and burn the house down at the end and sell the charred remains for $1. I'll take a million dollar salary for these services. Then I'll shut it all down and return the leftovers to the investors.

So total expenses for this endeavor: $1M + 31 * $1M + $1M in salaries so $33M. That's $81M better than Humane did, and I'll do it in less time!

I would immediately shut down and return $114 million to the investors. I'm keeping that extra $1 million as a tip for prompt service.

Is that your pitch? Do you think anyone would give you the money?

No the pitch is guaranteed returns

A variation on the Michael Dell plan. Smart.

You meant to write "generate $-115 million" I think. I'd start by putting all the money under a mattress which is already doing way better than Humane. Then I'd try to think of something fun to make.

The trick is you'd have to tell the VC how you'd spend their money before you get the money.

I don't think I should have to if they previously invested in Humane

Their investors are well known. May be you can give it a try? Easy money.

> Humane raised $240 million in funding from high-profile investors, including Marc Benioff, the chief executive of Salesforce, and his counterpart at OpenAI, Sam Altman

https://www.nytimes.com/2025/02/18/technology/hp-humane-ai-p...

I think you’re taking the joke too seriously. The user you’re replying to clearly doesn’t think their idea would raise money, they’re taking a dig at how obviously bad of an investment Humane was.

I like the idea of Sam Altman investing in a physical OpenAI wrapper. That's one way to try to increase revenue.

> and which AI product would you build

Why would it need to be AI? VC investors care about making money, not how.

Ah, I mean that is the theory, but the practice, today, is that you have to say the magic word to get money. This is actually fairly normal VC behaviour; the market as a whole has always been rather fad-driven.

You don’t need to generate $115M - just lose $115M and there you go

Bear in mind that some of these VCs likely preferentially invest only in dumb AI things, so won't be interested in your thing if it is too sensible.

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