“With all that cash, these guys essentially play an elite version of the lottery. Their $15 billion will start about 3,000 new companies. Most of these companies will flop and be forgotten. But maybe a handful will become the next killer stocks, the zero-ten billion accelerators. And the moneymen who put up the initial cash will make extraordinary windfalls..... "the math is simple:Let's say you have $100M to invest. You finance 20 companies at an average cost of $5M each. Assume, for the sake of calculation, that nineteen are horrendus flops that blow all the cash you spend on them.:Bye-bye, $95M. But one company becomes an incredible success, the next Amazon. You bought in cheaply at 25 cents a share. The stock goes public at $20 a share, and investors quickly bid its price up to $50 a share. so you've made 200 times your money: the $5M investment is worth $1 billion on this deal alone. After subtracting the $95 million in losses form the other deals, the bottom line is you've turned your initial grubstake of $100M into $905M. You've made nine times your money in only a few years. You're a genius. YOu're a star. You're a made man. (no one cares that you struck out nineteen times out of twenty.)”
