Senator Elizabeth Warren doesn’t think they are and she’s proposing a new bill to put in regulations that would make sure they are. She wants to establish a new “federal corporate charter” for companies larger than $1B.
Clearly, she detests and abhors Milton Friedman. I wish Friedman were alive to debate her. He would do so and relish the opportunity. He would eviscerate her points one by one with logic, smiling all the way.
Here are her points:
In the four decades after World War II, shareholders on net contributed more than $250 billion to U.S. companies. But since 1985 they have extracted almost $7 trillion. That’s trillions of dollars in profits that might otherwise have been reinvested in the workers who helped produce them.
We met Joe Holberg through Rob Topping. Rob is another Chicago investor. I never asked Rob how he met Joe but my guess is it was through the Michigan network since they are both alums.
Joe grew up in western Michigan. He paid his way through school and went on to work for Teach for America and Google. One day, he woke up with an idea, a cell phone and a computer and started Holberg Financial. Ironically, my father spent his teen years in western Michigan. I still have some family there in Three Rivers.
Holberg Financial is a financial health and wellness platform that helps employees reduce financial stress. 85% of Americans are financially stressed and 62% have less than $1,000 in savings. HF is 100% free to employees and 100% unbiased since they don’t sell data, products, or financial services. They just get people the unbiased info Continue reading "Our Investment in Holberg Financial"
Fred Wilson wrote a post today about where you went to school and the VC biz. He’d like to see some things change and he’d like it sooner rather than later. I don’t disagree but I also know that inertia, network effects and networks are hard to change.
Fred’s post came out of Richard Kerby’s post on Medium. My friend Rick Zullo is partners with Richard and was tweeting about it yesterday. They have a VC firm in NYC. Jason Rowley of TechCrunch wrote a series of posts about where VCs went to school and what they studied.
Unfortunately, it does matter.
It’s reflected in the cost of tuition and the difficulty in getting in. There is only one Stanford. There is only one Harvard. I think it will change but change will be slow. There are factors outside of network that bear on the reasons why.
Product and engineering lead the way with tech startups, as should HR, but unfortunately, this often means finance comes very last. Yet finance should come first — or at least much, much sooner — argues Caroline …
One of the things that came out of the lunch we did at the University Club the other day was the focus of the SEC. There are several agencies and independent organizations that regulate finance and the SEC is at the top of the pyramid.
I have spoken to both SEC and CFTC regulators on cryptocurrency. They seem to be working together and are not engaged in turf battles. Right now, they say that’s the case and you have to take them at their word. In past engagements, like the CFMA Re-authorization in 2000, it was a brutal bare knuckle battle between agencies and the industries they regulated.
Here are a couple generalizations.
When we think about markets the CFTC regulates, they are not targeted to retail investors. They exist for the risk management and risk transfer of professional investors and big time industrial organizations. That requires a different touch Continue reading "Regulation and The Retail Investor"
Congress started to roll back some of the Dodd-Frank law last week. This is good news. The reason I started blogging way back when was because of the debate over Dodd-Frank. You could see the freight train coming.
Sarbanes-Oxley was another act that was done in haste to combat one or two companies wrongdoing. Again, the end result was that companies were staying private longer. A lot of that has been fixed but why did we do it in the first place? Spite. Populism.
Government regulation is keeping the middle class and poor from growing their wealth. They are locked out of many types of investments because of the overlords fear. It’s wrong. One of my hopes with cryptocurrency is that this can be remedied.
I have used it successfully to pick strike prices for options trades. It is the best research terminal on the web. It’s not for moment to moment trading. It’s an example of the quiet things going on behind the wall that you might not notice because it’s not on your phone. But, they add a lot of value.
“If you think about Amazon, they took the book model, built brand equity, trust, credibility, and now they are a superstore for any retail product,” Cadre’s cofounder and CEO Ryan Williams told attendees at an industry event in San Francisco last week. “We’re doing the same for the investments world.” Robinhood’s cofounder and CEO, Vlad Tenev, speaking… Read More
Investors don’t want their portfolio companies to pay you too much, or too little. So they pay Advanced-HR for its compensation data pulled from 2,500 startups. With a generic name, the service has flown somewhat under the radar since launching 20 years ago.
As startups grow more professional while staying private longer, they’re getting serious about how they structure equity… Read More
Homebrew is announcing the close of its third fund. This time they’ve raised $90 million, an increase from $50 million in 2015 and $35 million for its debut fund in 2013. Led by Hunter Walk and Satya Patel, the seed stage venture firm has spent the past five years investing in U.S.-based startups at the onset. Several of its portfolio companies have gone on to raise significant… Read More
In the world of venture capital, the prospect of a successful “exit” looms large in the minds of investors. A VC’s business model is less about the money that goes into a startup than it is about what comes out. It’s true that most companies fail to exit gracefully, and of those that do, surprisingly few exit by going public. Read More
Atlanta-based Cardlytics made its public debut on Friday, closing the day at $13.37, just a little above the IPO price of $13. The company sold 5.4 million shares, raising $70 million. Cardlytics works with financial institutions like Bank of America and 2,000 others to run cash back programs. It partners with brands across restaurant, retail, travel, grocery and home subscription categories… Read More
Short answer if you don’t want to read the rest of this is, no this is not a meltdown. It’s not a correction either. For newbies, meltdowns look like this. If you believe this is a market meltdown, then perhaps you follow the Super Bowl Indicator too. When an NFC team wins the championship, buy the market.
If you are only watching Bitcoin, it is in meltdown phase. But, it’s not as if you had to be Methuselah to see it coming. The Bitcoin bubble might have been the easiest one to pick out in recent memory. However, it was impossible to short. You could have shorted it with futures once they started trading but it was very thin, and margin requirements were pretty high so your risk was high in an irrational market. The GBTC is 75% off of its high.
One of the most difficult things about being in a small fund is how much capital to allocate to an investment. Many funds put the exact same amount in each deal. That doesn’t seem right to me because the valuations of each deal are always slightly different. Cap tables are different. The capital needs of the company to get to exit will almost certainly be different.
Others are very random in their approach. They might put more in one deal because either they understand it better or they trust the lead investor more. Perhaps something clicks between them and the team so they feel more comfortable putting more money in.
It is sort of amazing that in America we don’t teach basic finance in public high schools. I remember I had to take a required class in personal finance at my high school. It was taught by a teacher that had no interest in teaching and didn’t understand basic finance. She was more interested in trapping us and sending us to the principal’s office.
One of the best things my wife and I did was save for retirement. Since I was self-employed, I had to save for my own. We maxed out on contributions every year. Early in our careers we worked for big corporations and maxed out on the retirement plan that they offered. It makes a difference. When we turn 59.5 there will be money waiting for us.
SoftBank’s $1.2 billion primary direct investment deal has officially closed, according to Uber itself, which confirmed the deal closure and provided the following statement to TechCrunch via a spokesperson:
We’re proud to have SoftBank, Dragoneer and the entire consortium in the Uber family. This is a great outcome for our shareholders, employees and customers, strengthening… Read More
Startup investors in the U.S. and Canada have been putting a little less money to work across a lot fewer deals in recent months. After three quarters of rising investment at early through growth stage, VCs have cut back in the fourth quarter of 2017. We look at some of the key data points for the just-ended quarter and year, including early and late-stage funding, round counts, M&A and IPOs. Read More
The two founders of Prototype Capital believe that pre-seed investment focused on student entrepreneurs needs to change. While existing micro-investment funds focused on young entrepreneurs spend their time at Ivy League schools and elite private institutions, Prototype Capital’s founders are betting on great opportunities coming from the same places that have driven Steve… Read More