Venture Capital

VC

I like to use that term above a lot, VC = Venture Capital. Following is the accepted definition from Wikipedia. The allure of VC from an investor point of view is to get into an investment at the ground floor. Nuture it, see it grow and have some amount of say in the growth of the technology or company. If you are correct, you don't have to pick a particular stock before it rallies. By definition you are already in when rest of the public knows about it. That is the upside. Downside? Well, there are many, but two most important ones.

  1. The success rate of VC is about 1000:1, meaning you have to finance 999 to get one right (but it can pay for 999 failures)
  2. To get into proper VC you must be an accredited investor (definition below); (simply you must have a net-worth of $1M plus, typically much higher than that)

Venture capital (VC) is a form of private equity financing that is provided by venture capital firms or funds to startups, early-stage, and emerging companies that have been deemed to have high growth potential or which have demonstrated high growth

In the U.S., the term accredited investor is used by the Securities and Exchange Commission (SEC) under Regulation D to refer to investors who are financially sophisticated and have a reduced need for the protection provided by regulatory disclosure filings. Accredited investors include high-net-worth individuals (HNWIs), banks, insurance companies, brokers, and trusts.

So the second one is usually a problem for most investors. They have the intent. The are willing to take the risk, but simply does not have the capital. Interestingly crypto is not regulated and doesn't have a high capital requirement. So benefits are multi-fold:

  1. Bar is let low for an investor
  2. Regulatory environment is relaxed
  3. Even people with high net worth can use crypto, as they can try a much larger number of projects each having a smaller capital requirement that a conventional VC.

image.png

That brings be to Splinterlands! I recently dug up a post from las December during the Pretorian Land Sale. At the time I invested $7500 for a Region.

https://peakd.com/hive-167922/@azircon/land-and-dec-splinterlands

Region is not very liquid currently, but arguably it is currently priced at $500K, and there is speculation that it can easily rise to $1M by the time land is operation. That to be is the allure of VC. 100X + return on your invested capital. In crypto you can do it legitimately with $7500! It is no brainer that I will also invest into upcoming Chaos Legion Cards in 5 days, and trust me, I will invest much more than $7500!

Startup Cycle

Below is the standard investment concept of a VC. During the Seed Capital the project typically do not make any money. Investors are putting money with nothing but good faith. This is the Alpha Card and Beta Card phase in Splinterlands. Then came Untamed and the Kickstarter Campaign. This was probably the first phase of true VC, where the game was making money. Dice could be the second stage. Land sale was probably a trasition into 2nd to 3rd stage. CL launch is probably the 3rd stage, which will likely tranistion into a broad plateau of new players and new dynamics for the game. Whether we have an IPO or not in future doesn't matter to me, my investment is already highly successful. That, ladies and gentlemen, is the allure of VC.

image.png

Source



0
0
0.000
17 comments
avatar

Great post! You've been upvoted by rosiew!
1UP-devider-comment.png

0
0
0.000
avatar

This post has been manually curated by @bhattg from Indiaunited community. Join us on our Discord Server.

Do you know that you can earn a passive income by delegating to @indiaunited. We share 80 % of the curation rewards with the delegators.

Here are some handy links for delegations: 100HP, 250HP, 500HP, 1000HP.

Read our latest announcement post to get more information.

image.png

Please contribute to the community by upvoting this comment and posts made by @indiaunited.

0
0
0.000
avatar

Seems like many Splinterlands players could become officially accredited investors sooner or later. Personally, I don't care about that at all. The whole concept is stupid. I need to accredit myself, proof that I am rich, to loose the financial protection limitation from the US government. Sometimes I wonder if the USA is worse than [place country with bad propaganda from the USA]. Nanny state, please save me from myself. I need to get some legal advise for Germany and see if they have similar stupid rules.

0
0
0.000
avatar

Yes, the concept in the United States is certainly limiting. Agree 100%

But it is not just the regulation that is limiting it is the second point which bothers me more. If a person is willing to take the risk why SEC must hold (read protect) hand? If the bar is set lower more people can participate in VC thereby increasing the net capital available and helping innovation.

That is what crypto is doing.

0
0
0.000
avatar

Exactly, we got the same/similar thing with crypto but it allows people to even invest cent amounts. This is awesome for both the investor as well as the project, as both benefit from that. Maybe one cent doesn't make a difference but it add up with many people doing that.

0
0
0.000
avatar

I've been following the #VC tag on Twitter as well as some others, and the amount of Venture Capitals out there is huge. There's too much money waiting to be invested and 100xed and SO many people with the capital to invest in the right people, and yet it seems like it is a rigged game, where many people become serial entrepreneurs and some others never get a chance despite their ideas being terrific (I know there is much more to it than just the ideas), but it dazzles me the amount of money VC are willing to risk for a highly improbable huge return and then again, if I had the money, I would definitely be part or would found a VC myself.

Are you in the VC world or just felt like writing about the topic?

0
0
0.000
avatar

How much should be invested by someone with 0 knowledge about the game?
Can it be seen as an investment or do you need to play it active?

0
0
0.000
avatar

Please don't start it as an investment. Start it as a 'game'. See if you enjoy it. If you do, then you can think about investing.

And Yes, you have to be active in the beginning just to understand.

0
0
0.000
avatar

Hello my friend
Sorry to bother you
Why does @curangel keep downvoting my posts?

Like this one: https://hive.blog/hive-105017/@oflyhigh/66hpsh-and
It took me about a full day to test and write this post
I'm very curious about what rules this post breaks that led to downvoted from @curangel?

0
0
0.000
avatar
(Edited)

A simple reason could be disagreement of rewards, maybe?

image.png

Your posts regularly earns over $100 per post, and you are also a witness. Your current 7 day pending post are in the order of $200 + 200 HP. Don't you feel it is substantial?

Also your typical post are a bit thin on substance, in my opinion.

Mind you, this is only my opinion and I am giving them to you because you requested. I do not think there is anything personal. As a witness do you feel it is necessary to post everyday?

Also on a closer look to that post, the curangel vote did not zero it, it was a newsflash vote that did it. Again just making an observation.

I think price wise Hive is doing rather great! As a witness, I like to share my appreciation and thank you towards you. Hope things are improving in China, health wise.

0
0
0.000
avatar

Maybe because you also upvote your posts with a a 5$, 100% upvote? x)

0
0
0.000
avatar


Hello @azircon… I have chosen your post about “-Venture Capital-” for my daily initiative to re-blog - vote and comment…
08.jpg
Let's keep working and supporting each other to grow at Hive!...

0
0
0.000