alt Hacker NewsThe positive aspect is that there is plenty if venture capital for innovators; the negative one is that those innovations are stifled by various extraction techniques that allow VCs and other investors to get a return on investment.
Crypto is a good example of how the equilibria is hard to maintain, and if the last cycle saw many interesting new products come to life, they all got crushed by ruthless profit-taking from early investors and team members.
Agreed about the venture capital for innovators part, but that has a danger of eventually the tail wagging the dog. Speculative investments enable VCs to fund other speculative investments until the entire chain is only focused on funding speculative products because that's where you get the meatiest exits
Again, see crypto as a prime example - because, at one point, you could command a valuation that was simply not tethered (heh) to reality, you had all these now-dead L1 chains raising $200M+ at $3-5B valuations.
This also leads to a situation where you only end up funding digital plays because the metrics there can be anything. You had these crypto companies raise based on "growth" when that growth was simply coins produced out of thin air and wallets created by the millions with a script.
You can't do that if you're building actual physical products