I'm not laughing. I'm just perpetually a tad depressed that stuff like this is apparently more valuable than defeating aging, fixing our economy in fundamental ways, or making life mulitplanetary. Hell, it's usually more more valuable and profitable than even minor and mid tier innovations in the IT sector.
Marginal value versus total value, my friend. While those endeavors you mentioned would probably have enormous benefit once achieved, they are so lofty that the marginal usefulness of a dollar put towards them is much less than the marginal usefulness of a dollar put towards a more modest goal.
And it's worth noting that Groupon seems to have a social purpose that I'm not sure most people who aren't economists would be able to articulate: abetting price discrimination, and presumably eeking us closer to the efficiency in those markets that use it.
Beautifully put.
Marginal innovations are like a greedy algo, & its not like the lofty goals are devoid of funding. Progress there feels so slow because the search space is so complex/expansive and there are so many local minima to flounder in.
Google and Fidelity just invested $1 billion [1] for 10% of SpaceX, putting its valuation at $10 billion, or twice that of Groupon, so I'm not sure where you're getting information that things like space exploration are less valued. It would probably be much higher, but at this point space travel is still very risky, so there's a high chance it won't pay off at all, compared to something technologically much easier to accomplish, like emailing people coupons.
Any one pharmaceutical company would be valued a couple of orders of magnitude higher than Groupon, let alone one that actually "defeated aging". Billions and billions are already invested in that. Pfizer for example, has a market cap over $200B. [2]
The 2nd piratebay dude had the same argument, and there is definitely some value to that notion -- convincing all these bright engineers to go join the so/lo/mo products instead of helping to build upon the BIG ideas.
It's not just risk. It's complexity. Groupon is a single product. No single product is going to put human colonies on another planet. No single company, or even single government, seems likely to do that. What, precisely, is Sequoia or Kleiner supposed to throw a giant check at? The rocket maker? The rocket fuel maker? The habitat designer? The logistics and supply companies? The cryogenics company? Lots and lots of moving parts and interdependencies involved, and no apparently clear winner to take the lion's share of the financial upside.
Everywhere. Look at the numbers - Groupon has only taken a total of 1B in investments. SpaceX recently took 1B alone from Google in a single investment - and on top of the public billions spent on NASA, and private billions spent on SpaceX, Boeing, Lockheed - and the numerous other academic research projects.
The difference, I'm sure, is publicity. I'm sure the Groupon IPO got a ton more press than the curiosity landing. You simply don't hear about how the billions are being spent on those project because they don't have relatively massive returns in 5-8 years like a social coupon company would, and large money is spent on relatively small, uninteresting steps.
Likewise it isn't wise for a private fund to aggressively invest in these spaces. What would be an individual firm's financial return on developing the internet? A lot less than the financial return on Google.
The other difference is capturing the surplus. Fixing the economy would be worth trillions, but how do you get your piece of it? It's much easier to capture the surplus if you can insert yourself into the payment process for an already existing product.
That's why IMHO only governments can do those kinds of things right now. Only governments can make high-risk-high-payoff extremely broad and long-duration investments and then capture the upside through overall economy-wide growth (via taxation and other means). Nobody else can both afford the risk and capture some of the upside.
It's possible that in the future someone will invent financial vehicles to make it possible to make those kinds of investments in the private sector, but it hasn't happened yet.
Edit: in a sense there is already something, namely government bonds, ETFs, and long-term positions in currency markets. But those are too coarse-grained. What we need is some way for private investors to make private investments in things that are all of: high risk, high payoff, and broad payoff.
The point isn't really Groupon, the point is that VCs and other investors are commonly thought of as chasing shiny, stupid things. But in the case of Groupon, public-market investors overvalued Groupon and in that way acted like our caricature of dumb, credulous, bubble-agitating VCs.
Few of the people that called Groupon a pump and dump before it happened ever had much regard for the institutional[1] and retail investors they dumped the stock on.
Interestingly enough, one of the founders disagrees with all those listed "buy" ratings to the extent of selling >90% of his shareholding on the open market at well below their price targets at the back end of last week. http://sleekmoney.com/bradley-a-keywell-sells-500000-shares-...
[1]although some of the mutual fund investors the article sniggers at for rushing to buying secondary market shares in the private market probably made out before the post-IPO bubble burst too...
Edit: I stand corrected on the founder share sale, which appears to be part of a more orderly divestment than my source claimed.
He's been selling 500,000 shares every month since they've IPO'd. That link totally misquoted how much he has remaining. He has over 30 million shares still. I have no idea where the author pulled out that 40,000 share remark.
It's not more valuable, it's just possible, unlike most (all?) of the things you listed. (Not trying to be a jerk, those things are just virtually impossible with today's technology.)
Defeating aging? I'd never be able to afford that even if it happened. Fixing our economy? The guys at the top will always find a way to screw me regardless. Making life multiplanetary? I won't be able to go, nor my kids, so what's the point?
Oh, save 50% on a meal at a restaurant I never went to before? Hell yes, sign me up! This will distract me from the depressing reality of life for a good ninety minutes at least.
(This is a parody of the average Joe, not actually my own thoughts.)
