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There wasn't market manipulation here on GDAX's part. The people they are compensating are those who got wiped because they were trading on margin (if anyone is not familiar, this adds much more risk). These people already had their portfolios auto-liquidated via the margin call so stopping trading afterwards had no impact. Same with stop loss orders, although there's a different mechanism at play there.

From GDAX's point of view the tradeoff boiled down to whether to invest in PR / brand today or risk a moral hazard problem in the future (users expecting bailouts so they take more risk).

There isn't a lot of substance but the Enron comparison is awfully loaded. The article specifically calls out the use of off balance sheet entities to hide costs-- for people who follow this stuff, that immediately triggers memories of Enron's use of special purpose entities and Lehman's Repo 105 off balance sheet shenanigans.

Yea, I think the industry seems to have been caught off guard by how aggressive the mutual funds have been with their mark-to-market valuations. This public data will likely have to be factored into the valuation methodologies of the private investors in these deals. Absent of this, Unicorn valuations were probably going to take a much longer time to deflate.

Why Web Pages Suck 11 years ago

I've heard discussion amongst the adtech crowd that it's "viewability tracking" products that are creating a lot of the slowness we feel today on the web.

There's typically an application process for the low income units. The rents are much cheaper than for the regular units. http://ny.curbed.com/archives/2012/06/05/city_now_accepting_...

I've seen buildings with separate doors and some without that have low income units. Even in the same building, the low income units are not as nice (e.g. no in-unit washer dryer, no stainless steel appliances, cheaper fixtures). Also, some buildings only provide keys to the gym and other common areas for non-low income. But I think they got in trouble for that and may have stopped.

Looked up the latest Janrain report. Looks like the trend reversed and Facebook increased their share:

"Facebook is regaining ground lost in Q4 2014, with noteworthy growth in the Consumer Brand (9% increase) and B2B (11% increase) verticals

Google+ saw an overall decrease of 6% from last quarter, widening the gap with Facebook to 8% with a total share of 37%"

http://janrain.com/blog/social-login-trends-across-the-web-q...

From the LP pov, it boils down to capital concentration. Most LPs I've spoken with are not that different from Michael Kim (LP from the article) in that they are for capital concentration. It is the most controversial part of the offering.

Reference: http://25iq.com/2013/01/16/charlie-munger-on-investment-conc...

http://robgo.org/2013/10/21/decision-making-speed-of-big-fun...

https://twitter.com/trengriffin/status/264789822982471680

https://twitter.com/sama/status/458094667972624384

That said, in the end, real performance trumps everything.

Remember the Bloomberg terminal snooping controversy from last year? Reporters at Bloomberg News had access to terminal meta data that allowed them to view user contact information and monitor login activity.

When the activity was disclosed, Goldman and a few other banks were trying to figure out ways to replicate some of the features (including chat). I'm not sure where those projects stand today but my point is that their biggest clients desired to sponsor the unbundling of some of the terminal's core features.

Their model definitely doesn't fit the industry way of doing things but I give credit to the Lightbank guys for putting something different out there and standing behind it. They have a track record and are investing a lot of their own money. Also, I think they saw how effective their approach with Groupon was and this program may be something where they are trying to replicate what they did there.

That said, this program isn't a fit for me so I don't plan to apply.

It's a good question but I think Rob was trying to leave that out of scope and focus on a process that probably fits what other seed/early stage funds have either proactively created or reactively evolved. What's implied is that everything is moot unless they meet founders that they deem investable. Only then, does he spend more time researching the other stuff.

Founders in this position usually sell because they can't raise any more money and the next best option is to shut down the company because they're out of money.

With an acqui-hire, at least you find a soft landing spot for some of your employees and your investors can tell a nicer story about one of their investments getting acquired (instead of getting shut down).

Not comfortable naming names but investor was late and founder said it felt like investor already knew it was a pass since he started meeting with something like "just for full disclosure we typically don't invest..." (I made this quote up-- I'm just trying to give you an example)

My opinion is that we need more big seed funds (lets say ~$50M fund size). We can't rely on Series A funds to do smaller deals. Revolution comes from below. Besides, those Series A funds have probably sold an investment strategy to their LP investors and they can't change (or don't want to look silly changing) strategies in the middle of their fund.