You know investors are a shrewd bunch. It is not easy making money out from them. It is like squeezing money out from rock or selling a fridge to an Eskimo. However, there is one loophole, and as human, we all have that weakness (some more than others) – Greed.
You make money from investor by promising them more money. However, you just ‘accidentally’ forgot to tell them how much you are making out of it.
Venture Capital and Startups
Chris Sacca on The Power of Incentives (read here)
This was Sacca’s very honest assessment of the risk-reward trade-off for both investors and those running the funds (emphasis mine):
This is a rigged game, right? And I’m just looking to make it even more rigged. For those who don’t know, venture capital is totally unfair. I mean, people give me their money; I draw a management fee off it, so they …