Re:Investing Returns on the S&P500
by nostrademons on Wednesday June 29, 2016 @12:15PM
(#12002630)
Many information-age business models (SaaS, marketplaces, advertising & other grow-first-then-monetize consumer businesses) are even more dependent upon capital than their industrial-age predecessors, since they run at a loss until they completely saturate a market and then turn on the money spigot. They've just been going to the private markets rather than the public markets because the Information Age started with a massive speculative bubble that scared everyone off. I think that as people realize that the Internet is real and actually will change everything about society, they'll be an increasing call for the general public to get in on this wealth creation.
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thats some of problem.
once they are a money spigot they don't need the capital market.
when they are money burning they are too risky for what we consider acceptable for a stock listing (though biotech seems to be an exception for some odd reason)
there are no 'safe' way to deploy capital that returns 6%
Re:Investing Returns on the S&P500
by nostrademons on Wednesday June 29, 2016 @01:57PM
(#12003339)
But that's always been the nature of capital - there are no returns without risk. Capital's always been a bet on the uncertain future - the whole reason we have the concept of a modern corporation is so that risk can be spread across lots of people who can afford to lose the money they put up.
The percentage of investors who lost their shirt in the Industrial Revolution dwarfs those who lost their shirt in the dot-com boom. It's just that everybody who went broke investing in a refinery or mining scheme that was just snake oil dropped out of the history books, and we only hear about the people who got fabulous wealthy.