Re:Lyft prices IPO at top of range
by tomp on Friday March 29, 2019 @07:20AM
(#19520635)
> Most people don't take that bargain, though, because they don't have confidence that the equity will be worth anything and need to eat in the meantime.
No, I think the reason is different, and it's quite rational. Diversification. VCs invest in 10(0)s of startups, but an employee is only employed by one, and his/her job depends on the success of that one startup. It makes sense to take whatever money you can, and invest it in other start-ups (or equity markets).
It would be much more fair of course if "normal" people were able to invest in start-ups, or at least in VCs. (AFAIK currently only "sophisticated investors" can.)
No, I think the reason is different, and it's quite rational. Diversification. VCs invest in 10(0)s of startups, but an employee is only employed by one, and his/her job depends on the success of that one startup. It makes sense to take whatever money you can, and invest it in other start-ups (or equity markets).
It would be much more fair of course if "normal" people were able to invest in start-ups, or at least in VCs. (AFAIK currently only "sophisticated investors" can.)