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Comment by androiddrew | Hacker News Reader

They raised 60 million. The investors think it’s worth 600M+

It's the valuation that is wild to me (I think the idea itself has merit). But these are the new economics. I can only say "that's wild" enough before it is in fact no longer wild.

These aren't new economics, it's just VC funds trying to boost their holdings by saying it's worth X because they said so. Frankly the FTC should make it illegal.

That's not how it works at all. Why stop at $300M, why didn't they just say $1BN out the gate?

Of course it's how it works, how else do you justify a company that is making negative profit into some how being worth $300M? Like that's just the game, IDK why people accept it. It's not democratic and all it does it prime the population for fraud and abuse.

Yeah, that's not the game at all. Have you ever invested in startups?

I don't need to "play the game" to realize private valuations are just marketing fluff not based in reality. It's literally "the greater fool" theory in action. When the incentives are to just lie and not put out something with some actual scrutiny like a 409A, it's quite clear what game is being played.

But yes, I would totally love to invest in startups with people's pension funds. It seems like the perfect scam where the only losers are the public that allows such actions.

Almost all of the world's most valuable companies were once VC investments that I'm sure you would have dismissed as just greater fool nonsense.

But more to the point, I was talking about how you apparently think VCs just make up super high valuations of the companies they invest in to justify those investments? Are you not aware that VC is a competitive market?

That is where I’m shocked being in a position of raising for a startup myself, what was in their pitch deck/data room that convinced them of this valuation? Or is it due to the founders reputation and not the substance?

Its like github - with the word Ai. <end>

I LOVE THIS FOUNDER - I am a 10 out of 10 - YES!!!

Take my (investors) money

That's not impressive. That's an incredible amount concentrated in the hands of a few looking for a place to live. It has to end up somewhere. Some of it goes everywhere.

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