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Basically people jumped on Dropbox to make money out of Dropbox's success. If Dropbox remain conservative and just continue to do remote storage/syncing well then those people won't get [as much] free money.

Those people aren't investing they're speculating. They're not there primarily to see Dropbox succeed they're shareholders because they want to get rich from other people's work.

So yes that's a problem for the company. Ultimately this model of "investment" can kill a business that is technically succeeding because the speculators don't see a high enough return. That's also a problem for society as it creates instability and prevents technologically successful companies from prospering long term.

At least that's one narrative that appears to fit well with my observations.



On the other hand if the speculators also reward people doing the work, they incentivize lots of them to do that work. Hence startup economy, where many companies blatantly lie that they care about users, where in fact those companies are only vehicles for the founders to get a good exit.


If investors have to risk money in order to [potentially] earn money, that doesn't sound so "free" to me.


Free as in no time or labor spent by themselves. At least that is what I think he meant


It turns out being an institutional investor is a fulltime job. It's quite ridiculous for GP to believe otherwise.


Be that as it may, this is pedantic quibbling outside of the point the GGP post author was actually trying to make: speculative pressure by investors (lazy or otherwise) conflicts with the aim of stable long-term equilibrium doing +/- one thing well.

If you actually care about building a sustainable business, not Unicorns and moonshots and other things investors want you to become and do, don't take investment, or at least not much.


Plenty of investors are risking other people's money, though. Venture capitalists themselves are prime examples of this.


So what? That's literally their jobs. In fact, both parties entered into that contract knowingly with the expectation that it will be mutually beneficial.

How is that money "free"?




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