> I would probably set up just such a "Black Swan Fund"
I think that's what venture capitalists already do.
They place lots of "small" bets. They lose money on most of them. But a small percentage do very well, and those investments "make the fund" -- that is, they cover all the other losses and create an overall profit.
I remember when Andreessen Horowitz launched, to great fanfare.
What was their revolutionary plan? To focus on investing in companies that would turn them a profit.
And people were slapping their foreheads as if this were some great revelation. "Of course! VC has been run as a charity!"
It's like saying "I am going to start a horse racing fund. I will only bet on the winning horses".
That's not a statement of investment strategy. It's a statement of wishful thinking.
I think that's what venture capitalists already do.
They place lots of "small" bets. They lose money on most of them. But a small percentage do very well, and those investments "make the fund" -- that is, they cover all the other losses and create an overall profit.
I remember when Andreessen Horowitz launched, to great fanfare.
What was their revolutionary plan? To focus on investing in companies that would turn them a profit.
And people were slapping their foreheads as if this were some great revelation. "Of course! VC has been run as a charity!"
It's like saying "I am going to start a horse racing fund. I will only bet on the winning horses".
That's not a statement of investment strategy. It's a statement of wishful thinking.