Venture Capitalist Geniuses Invest 120M without a Demonstration of the Product

[dealmaker]

Did Juicero squeeze Silicon Valley investors for $118 million?
A food tech startup that has raised $118 million in venture capital is facing questions over its flagship gadget. Juicero charges $400 for a machine that presses juice from its proprietary juice bags and that requires a smartphone app. The problem? Users may be able to squeeze the bags for freeusing their bare hands.(Silicon Valley Business Journal)

 

[marketsurfer]

However the real picture is more like $1M into 15 investments. 1 turning into $17m and rest going zippo pretty much. Approximate returns of 13-14% annually. VCs returning 14% in last 3 years from above link gives the real picture.

Ok, but we all like to think we can pick the unicorns.

Just like traders, there's an entire ecosystem of VC's and funds.

 

[Chuck Krug]

https://munchies.vice.com/en_us/art...solute-worst-way-possible?utm_source=vicefbus

 

[MattZ]

Imagine the VCs figuring out that you can eat an apple or a celery stick without putting it in a 4,000RPM rotation (juicer).

 

[Cuddles]

One of my mentors mentioned VC's throwing money at the most useless ventures back in the 80's in order to profit from the losses and or sale of said losses to others. It's not always as clear cut.

 

[peilthetraveler]

Imagine the VCs figuring out that you can eat an apple or a celery stick without putting it in a 4,000RPM rotation (juicer).

I don't think VC's are necessarily stupid. But they are prone to marketing and sales tactics just like the rest of us. What I'd like to know is how exactly did Juicero sell the VCs on this product. That's the real gold mine here.

 

[MattZ]

I don't think VC's are necessarily stupid. But they are prone to marketing and sales tactics just like the rest of us. What I'd like to know is how exactly did Juicero sell the VCs on this product. That's the real gold mine here.

My comments were sarcastic about this specific incident. I do not think VC's are stupid, but they also have the FOMO syndrome. They also miss out on opportunities and compete within themselves (VC industry) for product sponsorship. I guess this type of competition at times causes oversight. It's a bad trade, and it happens.

 

[Pekelo]

I guess careless would be the better word. They also tend to fund pet projects where they would like the project to succeed but the innovation or fundamentals are not there (yet). But when you have too much money you can be careless with it...

Interesting article:

https://bothsidesofthetable.com/what-to-make-of-andreessen-horowitzs-returns-cfbd562eeab9

 

[Pekelo]

Well, here is how VCs operate:

http://www.angelblog.net/Venture_Capital_Funds_How_the_Math_Works.html

"In a typical VC portfolio, most of the returns are from 20% of the investments. This is just a statistical fact - a law of nature. Statistically, if a VC makes ten investments, two will be winners and create most of the gains in the fund.

A minimum 'respectable' return for a VC fund is 20% per year. This is set by the expectations of the investors in VC funds, the relative risk levels compared to other investment classes and the performance achieved by other venture capital fund managers.

Another way to look at this is that a ten-year venture capital fund needs to repay investors six times (6x) their investment."

 

[zdreg]

I don't think VC's are necessarily stupid. But they are prone to marketing and sales tactics just like the rest of us. What I'd like to know is how exactly did Juicero sell the VCs on this product. That's the real gold mine here.

prostitutes, Superbowl tickets, rhino safari expedition etc.