Reddit took $1.3 billion in investor money. What makes you say they're not having their chain yanked? Going public solves an investor problem, but I don't see it solving anything for Reddit's community.

> Reddit took $1.3 billion in investor money. What makes you say they're not having their chain yanked?

Took. Past tense. Limited need to take more. Look at Reddit's Board: it's ten people, only one of whom (Mike Seibel) is a VC.

Your implication is that if they don't need more money, they can just ignore all those investor-owned shares? That doesn't make a lot of sense to me. Reddit's an odd duck given their ownership history and their investors. But I don't think they're that odd. Nobody gives you that kind of money without expecting to be well paid and soon.

> implication is that if they don't need more money, they can just ignore all those investor-owned shares

No, they can ignore the venture capitalists' shares. Reddit's Series F was led by a mutual fund. Most of Reddit's shares are non-voting common stock, under a voting-rights agreement or held by non-VC investors.

The difference is meaningful when tracing incentives. Venture capital, almost by definition, involves a high-loss high-reward portfolio. Most bets are expected to bust. That makes a middling bet that doesn't return the fund essentially worthless, which in turn encourages shooting for the moon. Late-stage private portfolios cannot sustain heavy losses. They are looking at preservation of capital in addition to returns, which makes them fundamentally different from VCs.

Shorthanding all investors in tech companies to VCs denies you visibility into a rich spectrum of actors, incentives and alignments.

Reddit was literally bought by a magazine company in 2005. Their parent company still owns 70% of their stock or so

That's the current board. Do you know how much control the investors have to change the board composition if they are ignored?

> Do you know how much control the investors have to change the board composition if they are ignored?

Most of Reddit's shares were issued in the era of founder-friendly voting rights agreements. The fact that those investors don't have anyone on the Board means they don't have the right to elect one to it. Private-company Board rules are Byzantine. But they're not thoughtless.

Isn't it also possible it's like Tesla with Musk. Even though the investors could oust him, they don't think it's worth losing his talent.

Twitter's problems started with VC investment where they were always compared against Facebook. I don't think Wall Street is much better, but by the time they went public, valuation and growth trajectories were already established by the VC narrative.

The chain is yanked whem you raise your first round. The yanking stops at Exit/IPO

Yeah, I don't know how it is for everybody, but I'm reminded of the line, "A good horse runs even at the shadow of the whip." When I've been at places that have taken VC money, there's always a deep, pervasive awareness that the deal is "exit or bust", and that every investor call should include good news in up-and-to-the-right form. At least with us, they didn't have to do much explicit yanking of the chain. Probably for the same reason that Fat Tony doesn't often have to remind people that he expects to be paid on time.

the generation of companies that defeat these vc companies will bootstrap, and use things like remote and chatgpt to make it work.

The yanking doesn’t even stop then; it just changes who is pulling. Various institutional investors are all over Google to do better than it is. Google makes billions of dollars a year. More. More. More.

Google has founders shares. Everyone always like to blame Wall Street. Management listens to them not because they have board seats but because they want to keep the equity based comp party going.

> Is "VC" tech's catch-all for capitalism?

No. It's a term specific for those investors working with: I don't expect you to survive, but if you don't get at least 10000% of return, you could as well be dead.

Almost all of capitalism works differently.