As with formerly intelligent folks like Dave McClure, Web 2.0 has a magical ability to make people forget logical reasoning skills. Today, we discover the odd case of Don Dodge, Director of Business Development at Microsoft’s Emerging Business Team. He had the cajones to stand up to Paul Graham’s stupid article about how Microsoft is done for by showing the tremendous revenue growth at Microsoft.
I read his blog at that time and thought to myself, “Wow, someone who actually has a brain.” Today, he lost much of that respect by sucking up to the grand daddy of Web 2.0 retardation, Paul Graham, by gushing about Demo Day at Y Bombinator.
I posted a response falting him for falling for the hype and he didn’t even post it to his blog. Instead, he defensively responded with a brilliant email:
This hardly qualifies as hype:
Like any VC portfolio, the Y Combinator companies will include a couple big winners, a handful of moderate successes, and a large number that will fail to gain traction.
These companies are only a few months old. But, investors have to place their bets now. Most companies don’t get funded. Of those that do many will fail. It is a tough risky business. A few winners makes up for lots of losers.
It is easy to sit back and criticize…maybe investing in bonds and treasury notes is best for you.
Don Dodge
Director, Business Development
Emerging Business Team
Microsoft Corporation
Incredible Don. Just incredible. If he read my post, he’d see that I was criticizing Y Bombinator’s hype. Y Combinator companies are for the most part, major failures. It’s fascinating to watch sycophants like Don Dodge claim that Y Combinator is like “any VC portfolio.” What is a standard VC portfolio? Please do enlighten us as to where the average seed-stage VC does well. Seed stage VCs have a 5-year return of -4.0%. That’s quite shitty.
Let’s compare Don’s recommendation:
1. Don invests in seed stage VC firms that generate a -4.0% return before carry and fees.
2. I’ll take his advice and invest in T-bills and earn my 4.77%.
3. I win. Don loses.
Y Bombinator shows again that the Paul Graham spin machine is in full force. I really admire Paul Graham’s vodoo abilities to convince formerly intelligent people to fall for the trap of thinking his companies are going somewhere.
Anywhere.fm is going Nowhere.fm. It’s in clear violation of copyright laws and has no revenue model. At a time when Pandora and Last.fm are being hammered by licensing fees, what will happen to Anywhere.fm’s even more retarded model?
The Web 2.0 sycophants are never ending. Welcome to the la-la land of the tech world where bright talent is lured into stupid business that allow you to share dating references through a social network for your dog’s fleas. It’s assuring to know that today’s young minds are out solving the most pressing problems of our generation.
