The J Curve

Don Dodge wrote an insightful post about venture returns, essentially arguing that venture capital is a bet between "risky and outrageously risky" investments. It’s hard to argue with his points.

The facts are what they are, but there is something missing from this and I can’t quite put my finger on it. Perhaps it’s the value over time of acquired knowledge carrying forward like a long term savings rate, or the people networks. I really don’t know.

The other fact that I can’t reconcile with Don’s assessment is that I know of quite a few funds that pull down 30+% IRR and they aren’t the top tier brand name funds that often get talked about. Maybe it’s a reporting issue because venture funds are notoriously secretive about returns.

The one immutable fact is that there has been an enormous amount of wealth created across a wide spectrum of participants through the venture finance model. Maybe it’s just transferred wealth?

UPDATE: Jason’s post is worth reading as well.

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Citizen Everything

I’ve been interested in the widely reported Duke Lacrosse rape case for a while now, but haven’t really been reading much of the ubiquitous press coverage. My primary source of information on this case has been coming from a blog written by a history professor from Brooklyn College. The blog is Durham-in-Wonderland and the professor is KC Johnson.

The substance of the alleged crime and any of the salacious details stemming from the case are not my motivation for writing this post. Quite honestly, I really don’t care about the case in general and my view is that it’s up to the legal system to assign guilt and innocence, and in the event of innocence with their being found any prosecutorial misconduct, then that charge is in fact more serious than the first and should be subject to a separate legal proceeding.

My inspiration for this post is the truly insightful and hard hitting investigative work being done by Johnson and the other bloggers on this case. I am constantly amazed by the depth of work being done pro bono, it would appear. It’s hard to know what is going on in the district attorney’s office or in the police investigators office, but I would hope the level of investigation is at least this thorough.

In an age when "citizen" is being appended to most everything in media, are we now at a point when citizens are taking responsibility for things with more serious consequences? I can’t help but think that there are some civil litigation attorneys standing in the wings waiting for this case to run it’s course, at which time, assuming there was no crime committed, the authorities in Durham are going to be subject to some severe lawsuits both as the County of Durham and as individuals. Those civil attorneys would have previously had to exhaust their own exhaustive investigation but with these blogs they have a lot of the leg work done for them.

Or is this case a fluke because of the high profile nature of the case, and even if citizen bloggers are doing the analysis there still has to be primary investigative work done by authorities. I think it’s pretty clear that this is the case here, but I’m still impressed by the quality of work being done on these blogs and were it not for their efforts then I would most surely have a more limited view of the case and the other elements surrounding it.

I also am curious about the correlation of the drop in Duke early admission applications and the overwhelmingly negative coverage of this case. The 80 million strong Net Generation doesn’t watch television or read newspapers to get their news, they get it from the web. While a Google search on "duke" doesn’t reveal much about this case, a Technorati search certainly does.

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