Who Are My Investors?

I got an email from the CEO of one of our portfolio companies last week.

It asked a very basic question, but one that I don’t recall being asked before:

I need to know if any of your LPs include  ……….  entities/interests. 

The CEO asked his VCs because questions were coming up internally and he wanted to answer honestly and accurately.

I expect to get more emails like this in the coming weeks as the startup and venture community comes to grip with the flood of money from bad actors that has found its way into the startup/tech sector over the last decade.

“Bad actors” doesn’t simply mean money from rulers in the gulf who turn out to be cold blooded killers. It also means money from regions where dictators rule viciously and restrict freedom. It could also mean money from business interests which profit by poisoning us with opioid addiction or warm our planet with fossil fuels.

I don’t claim to have entirely clean hands in this regard. When we sold our Twitter stock before the IPO many years ago, it turned out the buyer was fronting for gulf interests. I found that out after the fact but that doesn’t absolve me of anything. I could have asked the questions before executing the sale.

That said, I believe the investors in the USV funds we have raised over the years are ones we can be proud of. They include large pension funds for public employees like teachers, firemen, police, and the like. They include the family offices of some of the great entrepreneurs of the 20th century. They include endowments of some of the best research and educational institutions in the US. And they include the founders and leaders of some of the best companies that USV has invested in over our 15 years. And we manage funds for a few charitable foundations too.

It is time for all of us in the startup and VC sector to do a deep dive on our investor base and ask the question that the CEO asked me. Who are our investors and can we be proud of them? And do we want to work for them?

Sadly, the answer for many will be no and it will not be easy to unwind those relationships.

Those who can be proud of their investor base stand to gain from this emerging situation as our portfolio companies can recruit and retain talent better and we can compete with others in the market for deals with one more arrow in our quiver.

Not all money is the same. The people that come with it and who are behind it matter. That has always been the case and remains the case and we are reminded of it from time to time. Like right now.

#VC & Technology

Comments (Archived):

  1. David C. Baker

    Really appreciate the principled stand on this. Principles are meaningless, generally, until they cost us something.

    1. JLM

      .We have no values until after we pay the price for holding them.JLMwww.themusingsofthebigredca…

  2. jason wright

    Well said. +∞.I would also pay close attention to the client lists of PR firms and lobbyists.- ‘beware the company you keep’.

  3. PaulRoales

    Two questions:1. Why do you take any outside money at all now? Seems like you and your partners success combined with the reasonable size funds you have kept would preclude the need to continue managing outside money.2. Why not just list the LP’s publicly. What argument is there that these should be confidential just because they have been in the past?

    1. Pointsandfigures

      Some LPs require that the returns of your fund be public. Some funds won’t do business with those LPs. For example, many public/government pension funds have this requirement. Many Family offices/individuals prefer to stay private and deserve to be private.

    2. LE

      2. Why not just list the LP’s publicly.In addition to what Pointsandfigures says in his reply to you exactly why do they need to do this at all? Why? Because it’s the issue dejure today? So they go and have a knee jerk reaction and divulge info that they have never had to do? Do you really think this is going to impact the flow of deals? It is not like they are selling hot dogs and stand to lose a great deal of market share if they don’t.Why run scarred and bend over if you don’t have to. I don’t get it. I get it if you have to and if it’s not knee jerk. Most things like this blow over with the next news cycle anyway.This is business. No need to over react and bend to media and social media because the truth is it won’t matter to anyone in the future (most likely).Business decisions should not be made based on those types of emotions especially when they are driven by peer or media pressure.

      1. PaulRoales

        If the names of LPs does not matter, because it wont impact deal flow, then there is no reason to not release the names. Not releasing the names just because that is not how things have been done is not a good reason.If it wont matter to anyone in the future then there is no reason to hide.

        1. LE

          While their are always exception the chapter in the book is called ‘loose lips sink ships’. Generally you try to not disclose proprietary info that would help your competition and disadvantage you in some way or increase competition. You don’t disclose your rolodex.Now what has happened is that ever since the Internet came about there is such a flood of business and demand such that many of those old rules aren’t as relevant. After all if you have a car on your lot (and only one) and people come in sure you might tell them the directions to your competitor. Because you know you have 10 buyers for it already.I will tell you this. I get referred a nice amount of business from investors. Those investors refer me business from people they invest in and in some cases people they know personally.. But they never give my name to other investors. And yet they deal with them all the time and many they know personally. The people that they invest in do (they are not investors). Many in a big big way. It is more than a coincidence. It is expected business behavior.Look people do similar on a personal level. It’s what I call ‘don’t share the name of your babysitter’. Back when I had young kids you could never get someone to share the name of their babysitter. Why? Well if she had your friends name and had business then she wouldn’t be around when you needed her on Saturday night. Now if you didn’t need a babysitter that much maybe you would share.

          1. PaulRoales

            Right and that strategy would make sense if we were talking about some middling VC fund filled with ex-TechCrunch writers as partners.But USV is a top fund, all of their LPs will be back for as long as USV lets them invest. They are not worried that their LPs will invest in some other fund and not have dry powder for them left over.USV, et al, made their brand and separated themselves from the pack in large party by blogging openly about the ‘secrets’ of VC. How the deals were done, how things were structured, all the math behind it all. Why should they not take their competitively stronger position and use it to their advantage by using a strategy that others can not take?

          2. LE

            Agree in general however people reading the blog and taking business lessons at face value are not factoring in what you say. Not that I care (makes no difference in my life at all) but just trying to point out the other side of this.It’s like an actor that is at the top of their craft. And he speaks in front of a group of aspiring ones. Then they get the idea that that fierce independence and turning down roles (they walked in late and missed the part on how they started in the business and the suffering let’s say) is the way to be if you are a true and honest craftsman.

  4. Pranay Srinivasan

    I wonder if founders are asking this question *before* you take an investor’s money that could potentially stop the deal and may even shut down their startup – esp when usually theres not more than 1-2 term sheets on the table….

  5. William Mougayar

    Sort of a KYI, Know Your Investor.Large Institutional (hedge) funds already have a strict diligence process when accepting investors, but it typically focuses on AML. Now you are implying that a political and ethical dimension need to be added.The Saudi investment in SoftBank comes to mind, given the current events.

    1. awaldstein

      Yes, well said.And I welcome this wholeheartedly.We are what we say and who we associate with.And this means that it is a political and ethical action and will create pathways or obstacles as it very well should.

      1. Amar

        But how practical is this Arnold and what is a reasonable way to move forward? For instance:SA is one of the (the?) biggest backers of SoftBank.SoftBank’s larger investments include:Uber, ARM, Nvidia, WeWork, FlipKart, SoFi, DoorDash, OYO, Slack and so much more ….Do you own any of these stocks? Do you represent companies/customers who use these products? (answer to that one is most likely yes, since this list has Nvidia, ARM and Slack in it) …. +++++For the record: I agree with the broader sentiment. It is time for us as a global community to start clearly seeing that our choices have consequences. I also think it is important to not throw out our cumulative babies with the proverbial bathwater

        1. JLM

          .Sometimes, we should throw out the bathwater and strangle the babies.JLMwww.themusingsofthebigredca…

          1. Amar

            Yup but that gets noticed universally and is remembered for generations. So handle that privilege with caution :-)Oh and btw, that creates its own set of ethics issues because guess what – post hoc analysis will reveal that not all the babies strangled deserved to be strangled and the circle continues.I think Yogi Berra said it best: “If the world were perfect, it wouldn’t be.”It should not be necessary but I am adding it to be doubly sure. I am not against ethics and acting with honesty, integrity and personal accountability.

          2. JLM

            .There are no organizations on earth which have a clean record on ethics. None.The second hierarchy is created, the politics and envy begins.There are no organizations or persons who are infallible. The best decisionmakers in the public arena may claim a success rate of less than 50%.We try to get the big ones right. And fail miserably even when we do get some high percentage right.Man is a very imperfect beast.JLMwww.themusingsofthebigredca…

          3. JLM

            .Of course this is the core question of the Deep State attempt to overthrow Pres Trump with a paper coup in the DOJ/FBI/CIA.Who watches the watchers, and, more importantly, who punishes the watchers when those who watch them catch them up to no good?JLMwww.themusingsofthebigredca…

          4. Vasudev Ram

            >Of course this is the core question of the Deep State attempt to overthrow Pres Trump with a paper coup in the DOJ/FBI/CIA.Interesting. Had not heard of this. What is a paper coup? Googled but did not find anything in first few hits.>Who watches the watchers, and, more importantly, who punishes the watchers when those who watch them catch them up to no good?Good point.

          5. JLM

            .A paper coup is when persons in the Deep State use laws improperly to change the rightful outcome of an election.In this instance, the Deep State used the FISA Act to digitally surveil a member of Trump’s campaign – an insignificant member, Carter Page – because this enabled them to utilize the “two hop” rule meaning they can surveil CP plus everybody he is contact with plus everybody these contacts are in contact with.By entering the digital surveillance at a low level, they were able to surveil the Trump campaign at the very top since even Pres Trump himself was within the “two hop” shadow.Carter Page was the subject of four FISA warrants which require a likelihood of representing a foreign government — being an agent or a spy — higher than probable cause.A FISA warrant cannot be renewed unless the prior warrant resulted in “take” which furthered the investigation.In fact, Carter Page has never been charged, implicated, appeared before a grand jury or suffered any untoward consequences proving that the original FISA warrant and the three renewals were bogus.This FISA warrant was based on the Dirty Dossier and the applications failed to spell out clearly that the DD was the work product of the DNC, the HRC campaign, and was totally uncorroborated.This was the work of one campaign using the weaponization of the DOJ/FBI/NSA/CIA to discredit another campaign and to, ultimately, appoint a Special Counsel on the basis of false allegations contained in the DD.It went further in that part of the justification for the FISA warrant was supportive news articles which the DOJ/FBI leaked to supportive journalists which sourced the DD.This was considered as corroboration when, in fact, it was sourced from the same DD and was leaked by the DOJ/FBI. This, of course, is a felony.This was a paper coup and we are only now starting to understand the breadth and depth of the conspiracy.Already the FBI Dir, the ass’t Dir, the chief counsel, the chief of staff, heads of departments, and the likes of Strzok and Page have been fire, terminated, or resigned.They are all clamming up.This was the Deep State trying to pencil whip and paper cut their way to overthrowing the government.Of course, nobody ever expected to be caught because HRC was supposed to win. That didn’t happen and the rest is being learned.JLMwww.themusingsofthebigredca…

          6. Vasudev Ram

            Wow. Crazy stuff. Goes on all over the world, of course.

          7. Vasudev Ram


          8. Vasudev Ram

            >The second hierarchy is created, the politics and envy begins.Quotable.I don’t like to use clichés all the time, but they can be useful, and should not be dismissed outright (otherwise it is like trying to come up with novel wording all the time for old and known things or concepts, which is a hipster / teenager [1] trait – “we aren’t the same as those oldies – we’re different – we’re so cool”. Dudes and dudesses: You are exactly as cool, or hot, or tepid, or lukewarm, or uncool (got you there 🙂 as your next door neighbor, whether above, below, or to the side of you – whether in age or experience. The very trait or desire to appear or seem cool immediately and automatically makes you NOT cool. Say what? Figure out why. If you can’t, you’re not cool :)This one – “The second hierarchy is created, the politics and envy begins” – seems to be “the human condition” – a cliche, but true, as many are.[1] Teenagers can be of any age. It’s about mental maturity, not chronological age. There are youngsters who are mentally adults and vice versa. Seen them. Psychologists say so too. It’s a virtual concept as well as a physical one. [Startup opportunity, wannabe startups]I once had a team of youngish devs and QAs (2-5 years) at a large software company, where I used to tell them when they were behaving childishly. Initially, they did not believe it, and kidded me back. Some time later, the senior-most of them , *voluntarily* said to me once, during some talk we had, something like “Ya, we are like teenagers; I too am like a teenager; you are right”.

        2. awaldstein

          Hi.I’m certainly no saint nor religious about anything.You have your beliefs and you work as a person to adhere to them.I am not a believer in purging the past. I’m a believer in being conscious of the future I in front of me.Have a lost a number of lifelong friends over the politics of the last few years? Yes and so be it.Some (one in particular) i have truly struggled to find common ground but there are some hard lines.But–I need to state that the truer you are to your beliefs, to your core skills, to your passions, the better it works out.For me at least and this formula works for business as well unless I am just crazily lucky.

          1. Amar

            🙂 I agree with you. Yes, if we never dream of a better and kinder future, we will never get there. Thank you for responding.p.s maybe it is both. Your formula works _and_ you occasionally get crazy lucky 🙂

          2. jason wright

            “Have a lost a number of lifelong friends over the politics of the last few years? Yes and so be it.”We all have so much more in common with each other than we do not.One can have new friends, and one can have old, but one can never have new old friends.We have to stay away from the extreme ends of the spectrum of thought to remain civil and sharing with others.

          3. awaldstein

            Dunno.I have always had friends at the extreme ends of all spectrums. Especially with religion.From born again Christians to my oldest friend, a Chasid.Pragmatic bigotism and disdain for personal rights of this despotic administration has broken that.At the end to me it is all ethics and respect for personal freedom.

          4. jason wright

            when dining out with a despot sit at a very long table.

          5. awaldstein

            ha!harder when the despot is the government.decided to vote early, travel and take the election results by myself in a private place so I can address my thoughts clearly regardless of the results.

      2. Adam Sher

        LPs do not have a operating power in VC funds, which is an important distinction in who you associate with. You are who you associate with would apply to GPs, employees, and investments. It seems like you, and others, imply that money from certain LPs comes with the baggage associated with taking a loan from a mobster.

        1. awaldstein

          I am implying nothing.Clueless where your statement came from.

          1. Adam Sher

            I read your statement “we are what we say and who we associate with” to include the company of your LPs. I disagree with that.

          2. awaldstein

            Fine.Not looking for agreement nor confirmation of my statement, simply what I believe and live by.

          3. Adam Sher

            Sharing my response to Donna with you since I think it’s relevant.I’ve been mulling over this for the past two days and I move my position and think GP’s should better discriminate from whom they accept money. One reason is that I’ve been a GP and KYC I do not view KYC as an effective measure. Another is that many LPs in the HNW and institutional world invest together (club investing). To them, appearances matter, and they often speak amongst each other. Where I’ve seen the most potential for shade is in family offices (I realize Sovereign Wealth Funds are probably even bigger but I don’t have experience there).Is there a benefit to accepting money from a source you morally or politically disagree in the same way governments keep back channels of communication open with regimes they denounce? I gave the example above of a CleanTech fund accepting LP money from Koch Industries.

  6. Tim Lawler

    as a VC should we be questioning the source of our co-investors’ money?

  7. Pointsandfigures

    Yes, but since you bring it up I am seeing a lot of discrimination based on politics in the VC sector. People inside companies are being actively discriminated against or forced to be silent. Entrepreneurs won’t do deals with a VC that might be of a different political party. Some people won’t invest with someone because of politics. That’s stupid. It reminds me of Jim Crow in the South.I am empathetic to a VC raising a fund and only wanting “principled” investors. But, would you take money from Altria’s pension fund? They likely will wind up controlling most of the cannabis industry in the future and won’t just be tobacco. Should you take money from an alcohol companies pension fund? What about fast food? What about an oil company pension fund? They provide most of the investment into alternative energy. What about guilt by association? If you take money from an outfit like Goldman Sachs/JP Morgan/MorganStanley etc and they do investment banking deals with the Russians/Chinese/Saudi’s is the money you took dirty? There are not cut and dried answers to the question.On the flip side; if you are funding things that are going to make a difference in people’s lives and raise their standards of living, maybe the opportunity of doing that is greater than the cost.

    1. JLM

      .Technically pension funds are held exclusively for the benefit of the pensioners. The fact that they earned that pension from employment at a certain company should not really color the dollars.Sovereign wealth funds are different, of course.JLMwww.themusingsofthebigredca…

    2. awaldstein

      The opportunity is never greater than the cost.The end never justifies the means.Sure its personal. Sure it says what you believe,That is what everyone should do.

      1. Pointsandfigures

        OpportunityCosts/Cost factor in every single decision. Gary Becker on discrimination is totally insightful. http://review.chicagobooth…. By the way, personally I think the Middle East is full of a lot of barbarians in the way they organize their societies but I think there is a much broader point here.

        1. awaldstein

          Each to their own.I have mine and am very open and honest about it.It is a hard line that I am comfortable with and my professed views on social good, on individuals rights, on healthcare, on gun control, on diversity and tolerance, on environmental causes actually attract what I’m willing to invest and participate it.An ethical pipeline of opportunity works just fine. It cuts me off of nothing.

          1. Pointsandfigures

            Ethics are smooshy and depend a lot on perspective/experience. This isn’t to say not to have them-but recognizing that they are variable is important. An Armenian might have different ethics than a Turk.Would you be a part of funding a fossil fuel project if it enabled poor disadvantaged people to have heat and be able to get to work safely?

          2. awaldstein

            Ethics are not at all squishy and the origins of them matter not at all.They are 100% subjective but speak for themselves.

          3. Pointsandfigures

            Totally squishy. You don’t realize how squishy until you have taken a mandatory ethics course. After the FBI sting on the trading floors at CME/CBOT, we took mandatory ethics. I am still friends with the professor of law who taught it at CME and our kids went to school together. He’s probably more left wing than you are but we are still good friends and he will tell you they are squishy. There are some absolutes but there are not as many as you think,

          4. JLM

            .All ethics are situational. That is the unfortunate reality.The Goat Herder Problem.When you are at Ranger School, you are faced with the Goat Herder Problem.You and a patrol of 25 Rangers have just been dropped off on the side of a mountain. You cannot arrange pickup for 2 days. Your mission is to go kill some shitheads in a little village down the mountain. Takes you a day to hump there.These men’s live are in your hand, lieutenant.You run into a goat herder.The goat herder is a native and will go tell the local guerrillas that you are on the side of their mountain and they will come kill you.As the Ranger patrol leader, what do you do and why?Solution A – you kill the goat herder and continue on your missionSolution B – you capture the goat herder and take him with you, but the guerrillas are going to notice he is gone and come looking for himSolution C – you do nothing and the guerrillas come kill you because they have a larger force and you have limited ammo and cannot get an extract for 2 daysThe school solution is Solution A. Of course, it is also, arguably, a war crime, but you have 25 Rangers’ lives in your hands.All ethics are situational.JLMwww.themusingsofthebigredca…

          5. awaldstein

            We are good friends. Have been for some time.But the idea that I need to take a course on what I believe in is honestly whacko.If someone is a bigot, a misogynist, a crook, a science denier, there is no ambiguity at all.My subjective interpretation and definition of these is all that matters.It’s always hard work to be a better person. It is not ambiguous what needs to be done.

          6. tys0n

            This is a cool outlook. I feel like I strive to be apolitical and use reason weighed with ambiguity when looking at issues that affect me and use empathy when looking at issues that affect others.The good thing about money is that it’s really ambigious and definitely not political only bounded by the clear cut law. When people on finance blogs like this start grasping at politic, ethic, and self righteous branches on their way down, it’s insane.There’s gotta be a catch here. No way all these crypto bros consider themselves real investors. Is this where I empty my wallet into crypto via message lol. Right. Get a grip people.

          7. tys0n

            So you let some dorks scare you into doing things ethically. Ethically isn’t the law and you should have just been unlicensed and fined. What this is crypto? So instead of lawyering up you decided to let an ethics professor influence the early stages of a different type of trading platform. Cool. He probably had fun writing up a report for the senate on you tools while you pissed you huggies listening to his what ifs during lecture. Gtfo. You hustling crypto is unethical but definitely should have known the actual law. You copping out to a plea or accepting a penalty just shows you were over your head and a sellout since your retribution probably directly attributed to future laws. Prime exampled. You are looking for validation in the wrong area man. You should call your mom.

          8. JLM

            .When you describe your views as being against “Trump Republicans” you are not mouthing ethical distinctions or considerations.Those are patently political views. Nothing more refined nor intellectual, just raw tribal politics.Nothing wrong with that. Just don’t pretend you are making ethical judgments. You are making decisions like a political hack.This is just one more pathetic example of the left and lefties being unable and unwilling to accept the outcome of the Nov 2016 election.Move. The. Fuck. On. before you give yourself a brain tumor.JLMwww.themusingsofthebigredca…

    3. LE

      I think you need to extend the question further. Let’s say you are starting out. Let’s say you (as a person needing money) does not have the liberty of picking and choosing who you deal with? Then we know what most rational people will do. They will take money from who they can get it from.Also to your point it depends on how hard you want to look down the chain of custody of the money. Where does it end?What upsets me the most is this idea of the company employees bullying who they work for. And that they apparently have worked their way into a position of power to do so. And then they just ratchet up their demands. Honestly a union is a better situation than this. At least there is some structure to that process. Let’s see what happens down the road when they have families and a true fear of losing their job and paying their high expenses. Let’s see how they act at that point.Everyone can be a ‘knocker’ when rolling in dough and opportunities.

      1. Pointsandfigures

        True. You see the true ethics in people when they are at their lowest point. Saw it every day when I traded. Everything was great until you lost money. I suspect is the same around the board room with VCs

    4. Matt A. Myers

      It’s a tough question. If that money has a high chance of countering these systems that are harmful or hurting people then maybe? If there’s other money readily available then maybe not? As I said in a comment to @JLM:disqus elsewhere, money from bad actors will usually take a discount to get their “goods” into the market, to get any return, or similarly perhaps have a higher risk tolerance with their money.

      1. Pointsandfigures

        Deconstruct your comment via the lens of Gary Becker. We can only estimate the benefits of investing the money and it’s 100% subjective. At seed I won’t value a company the same as you.Next, the discount that the Saudis/bad actors might have to give to get into the market magnifies their cost. There is a supply demand equation that will arrive at equilibrium depending on the ethics of the demand side. E VC en the Swiss played ball with the Nazis. Many in the IS currently take money and do business with the Chinese despite what they do.Should you accept money from Teachers Unions? They are against school choice and depending on your view really hurts poor peopleAs you said. These are not easy questions nor are they cut and dried for most people.

        1. Matt A. Myers

          I’m unfamiliar with Gary Becker – any material you can reference for me to look at when I have a chance, short or long? Thanks.

        2. Matt A. Myers

          The question then becomes do you want to get in bed with someone who has a knife, and doesn’t mind using it because you offended them in some way? You could potentially even use this to your advantage and be corrupt yourself, helping perpetuate this kind of behaviour directly, leveraging the fact they don’t mind using their knife – or indirectly they may help your cause without you even knowing, and being happily ignorant of such strong possibility.You can’t look at the macro level in isolation to simply highlight the benefit of cheaper money being available at the exclusion of the micro environment and actions it helps allow/create/perpetuate – like using that knife; unless you’re okay being ignorant, ignorance which leads to not taking into account the full picture – “ignorance is bliss.”It could arguably be better for society in the long-term (longer horizon than any VC fund, or perhaps even more than 2-3 generations of time) that these bad actors with their behaviour simply dissolve along with whatever money resources they’ve amassed over time from their actions – there would be less future resistance and possibility of malicious, violent, harmful behaviour; otherwise money is clearly a carrot that enough people are willing to turn enough of a blind eye towards. An individual couldn’t afford this level of disconnect economically, however nations working together can through economic punishment – and it certainly puts pressure internally at how these bad actors can function; it is terrible for the good citizens of an area of course, that lowered quality of life of course allows bad actors to even more easily manipulate the populace with propaganda, fear tactics, etc.

    5. tys0n

      This isn’t rocket science. You need to focus on something that people need and stop over analyzing venture capital like a cry baby. There is flip side. Good ideas that are designed well will sell. The international market is way out of your league. Bulshit ass post. You guys should post under real names so you don’t defraud any more investors with your chump ass ideas.

    6. tys0n

      I think it’s simpler than that. No one is going to change their political views unless given a good reason. If international relations with a democratic nation exposes the culture and people to a better life. That culture might pick up some attributes that reflect democracy but will not turn into a democratic state overnight. It’s absurd to think and to also think if there’s oil being pump it would not be considered commodity. It’s money. If you don’t like where it’s going or how it’s spent you need to make and spend more than everywhere and one you despise.Saudis understand their resources the best. Just like us Americans understand ours. Renewable energy and consumption is definitely a big topic at the energy summits these leaders go to. Everyone should be invited into the global market to help pursue energy solutions. It’s unfair and inhuman to deny people a chance to make the world better.

    7. awaldstein

      With all due respect, this view of political diversity along side true diversity of gender, sex, race, orientation is honestly just whining and whacko.What leader in her right mind trying to build a team of focused people would want to introduce aberrations that speak against women’s right to choose, the right to love who you want, climate control?None would.Conservative economics is not the same as crazed Trump Republicanism.

      1. JLM

        .Typical lefty. “You may look different, I give you permission, but you MUST think the same as me.”This is very small minded as if you are unable to stand the rigor of anyone who does not look the way you want them to or think the way you dictate.That is not free thinking; that is repressive and coercive.Many of those subjects do not belong in the workplace. Who cares what a person thinks about a woman’s right to choose – particularly if they may be a man. For you to inquire and demand a litmus test is to create a discriminatory element in your hiring.One’s thoughts in regard to climate change, using that as an example, are totally irrelevant to solving a software or eCommerce problem. Why are they relevant, inquired about, or dispositive?It is a form of discrimination. Bottom line — phoney lefties allow one to look different as long as everybody thinks the same even about matters which are irrelevant to business or are not mission critical.Are you a business, a businessman, or a social dictator?JLMwww.themusingsofthebigredca…

  8. JLM

    .If the world has just discovered that the Saudis are a repressive, brutal, murderous regime, then you haven’t been paying attention.The tiny Al Saud family created the Kingdom of Saudi Arabia in 1930 through a series of wars in which they killed their neighbors – beheaded many of their leaders – and took their lands.We would have no interest in the ME but for oil. It is oil which fuels the barbarism of the Middle East. It is our dollars which buy their oil which fuels their backward, medieval approach to everything – women, lesser souls, each other, their neighbors.They are wetted by oil and swim in blood.They practice an extreme version of Islam – itself a medieval, barbaric set of evil beliefs – which allows them to export jihad as long as they are kept safe at home.As the hosts of Mecca and Medina, the Saudis are the protectors of the holy sites at the core of Islam.If you have never read the Quaran, please don’t let another day go by until you explore the ritualistic manner in which this document directs the castration and burning out of the eyes of the infidel. You will love it. It’s just like other peaceful western religious practices – like baptism or communion.Wonderful views on the treatment of their own and infidel women – bit primitive, but very clear.Take away oil and these people would be wandering the desert like the savages they are.This is one more reason why America should be looking to its own interests in the world. The US of A has spent a lot of time propping this savage regime up — no political party has clean fingers on this.We created this mess with our insatiable appetite for oil. Another reason why American oil independence is so important.Still, there is a lot of hypocritical moralizing and faux virtue signalling at work here. If we are to be free of the ME, then we have to embrace nuclear power.JLMwww.themusingsofthebigredca…

    1. LE

      Isn’t it also an interesting corollary that Israel is in a better place because of that oil? Think of what would happen if the promised land was somewhere non strategic to the US Interests. And think of all the good tech that has come out of Israel as a result of the war they are always fighting with their neighbors. Think of all the good that has come out of that conflict. Let’s face it the majority of advances in this world have come as a result of the good guy fighting that bad guy. Let’s hope that never stops, eh? (Exhibit A: The Internet in the cold war).I think one other point needs mentioning. There are certain societies in the world that honestly function best under the type of dictatorships that these countries have. Look Russia couldn’t even hold it together or become democratic. It is to ingrained in the way they are.I don’t think people truly understand how these cultures operate. I have a slight idea because I was raised in an environment of ‘greenas’ that is people from the old country who had to fight for survival. They would and did get away with whatever they could. Not because they were dishonest at the core but because that is what you did to survive where they grew up when you were just one of the masses (and not elite in some way). So you can’t take a society like that and just redo it over night with democracy.

      1. JLM

        .I believe you would get an argument from the Israelis.Israel was created as a dumping ground for displaced European Jews who had survived the horrific brutality of the Holocaust. From the second they were created, the Arabs tried to destroy them.The War of Independence (Nov 1947-Jul 1049)The Reprisals (1950-1969)Suez Crisis (Oct 1956)Six Day War (June 1967) Egypt, Jordan, Syria supported by Iraq, Saudi Arabia, Kuwait, AlgeriaWar of Attrition (1967-70)Yom Kippur War (Oct 1973) Surprise attack by Russian backed Egypt, SyriaSouth Lebanon, Palestinian Insurgency (1971-82)Lebanon War (1982)South Lebanon Conflict (1985-2000)First Intifada (1987-1993) Palestinians, West Bank and GazaSecond Intifada (2000-2005)2006 Lebanon War (Dec 2008 – Jan 2009)Pillar of Defense (Nov 2012)Protective Edge (Jul-Aug 2014)Continuing present troublesThe Israelis have been fighting for their survival since their inception.It is difficult to grade the book as “good” with this much gratutious violence initiated by Israelis enemies.The alternatives to an American style democracy are not despotic dictatorships. There are a number of different alternatives. The English monarch and its democratic House of Lords and House of Commons is a different approach than our representative republic.The USSR was a dictatorship and those countries which were liberated by the fall of the USSR have done just fine as different forms of government thus presaging the Russians would also do fine. Again, not necessarily an American style.The Poles knew different forms of governance and have settled in — after a century of strife — as a democracy. Why would the Russian people be any different?American society evolves at a rate which is sometimes fast and sometimes glacial, but when it begins to move the changes are often tectonic. Take as an example – gay marriage. Pres Obama comes into office as an opponent (bolstered by his reading of the polls, no doubt) and exits 8 years later with gay marriage as the law of the land.Nothing changes over night.JLMwww.themusingsofthebigredca…

        1. LE

          I am saying that the fact that there is oil in the middle east means that the US was more likely to support Israel (in a bigger way) than if that dumping ground was located elsewhere (not strategic to US interests).Sure the Israelis are high caliber and yes some of my relatives went to Israel after the war as opposed to the US. But Israel’s location is strategically more significant is my point. Take the same group of people and put them elsewhere (w/o the infusion of US money) and the result could be vastly different.See this also:https://www.jewishvirtualli…So for example in 1975 Israel GDP was 12 billion and the US gave them roughly 800 million. ($800 million you just google search it’s not on the chart).Honduras otoh got $66m aid (2018) with about the same population as israel. (9.26 million Honduras vs. 8.7 million Israel). Israel aid in 2018 was 3.8 billion.Not all because of Sheldon Adelson and the Jewish lobby either (although for sure that will get you some extra money).

          1. JLM

            .The American Jew and the jewish American are two different people. Israel is an American state. Not saying it should or should not be, but it is thematically true.America in the post war was the only country that could guarantee the survival of Israel because Britain (whose land and area of influence it was) was broke.The world was so tired of fighting that the Swiss got away with having supported Hitler with no repercussions. They had a stranglehold on England and France who had to borrow money to survive.The Swiss should have been held accountable for their collaboration with the Nazis.The world decided to do some strange things at the end of WWII because of how tired we were. We executed the Nazis, but propped up the Emperor.JLMwww.themusingsofthebigredca…

          2. sigmaalgebra

            With no oil in the Middle East, Israel would have had no serious trouble with the Arabs or Islamists.”Any time spent on the Arabs is time wasted. They are a nation of sheep stealers.” — Lawrence of Arabia.The Jews from Europe brought with them the pinnacle of Western Civilization in science, art, technology, military technology, finance, many areas of business, e.g., the diamond trade, etc. The Arabs were no competition at all in any sense, and the population density in the desert was very low.

          3. LE

            Actually that is a good point. I neglected to realize that if the economics changed on both sides the advantage would go to Israel even w/o the US Money. [1][1] But only if ‘no oil in the region’. If ‘oil in the region’ and the US simply didn’t value it (and others did) then it would be a problem for Israel for sure.

          4. sigmaalgebra

            US support of Israel has had a special driver — whatever the heck Israel has needed at least to survive and without anything like another Holocaust.IIRC, in one of the wars, when suddenly Israel needed some tanks, presto, bingo, US military cargo planes took off in the US and delivered the tanks.The story goes that there was a plutonium processing plant, IIRC, somewhere in Pennsylvania. They were sloppy, a little sloppy, in some of their record keeping, and several chunks of plutonium, each about the mass needed for a bomb, were missing. Then there were some rumors that somehow Israel had some plutonium atomic bombs.IIRC, Israel has at least one nuclear reactor. With one of those, can make plutonium which can be separated by just fairly routine chemical means, e.g., as the US did in WWII in Hanford. Israel might have done that.For expertise in working with atomic power and atomic bombs? Uh, let me think: The technical head of the Manhattan Project was J. Oppenheimer. For more, let me see, for a picture of three contributors to the effort there ishttp://www-history.mcs.st-a…On the left is S. Ulam, good mathematician from Poland, e.g., got a quite general result the French probabilist LeCam called tightness (I used in a paper I published on anomaly detection). The guy on the right is J. von Neumann. The guy in the middle is just a physicist!There is the special US F-16i and F-15i. No telling what the “i” abbreviates, but both have enough extra fuel tanks, etc. to be able to deliver a bomb load from Israel to Iran.Yes, Moshe was likely correct about the Patriot missiles not doing much in Gulf War I. But IIRC Raytheon, etc. tried again and did Iron Dome now deployed in Israel.Net, the situation is: The US “has Israel’s back.”, is a big brother with a big checkbook and weapons store house. The US guarantee is no more holocausts or anything close.E.g., Saddam said the wrong word, “atomic”, and the US spent ballpark $7 trillion demonstrating that no one in Arabia or a Mideastern Islamic country should say that word — wrong word, forbidden.Some guy, IIRC, Hussein Obama, didn’t understand that that the word was forbidden and signed up with Ayatollah Kockamamie, Amadinanutjob, lots of Mullahs to permit processing uranium. Trump reversed that situation and is on the way to making “atomic” a forbidden word again.Arab and Islamic politicians can get their streets all up on their hind legs, e.g., screaming “Death to Israel!”, and get a lot of them killed, e.g., in Gaza, Syria, the West Bank, Sinai, etc., but Israel is not at much risk.

          5. JLM

            .There are more than 250MM Arabs with countries like Turkey, Egypt, Iran, Saudi Arabia, Iraq, Syria making up the ones with armies.There are 8MM Israelis.The Israeli military is more than a match for the Arabs thus far, primarily, because no Pan Arab military has ever emerged to drown the Israelis.The 1973 War came close with the Russians backing Egypt and Syria. The Syrians almost took Tel Aviv but for Nixon sending US tanks and ammo.JLMwww.themusingsofthebigredca…

        2. LE

          The Poles knew different forms of governance and have settled in — after a century of strife — as a democracy. Why would the Russian people be any different?But they were different. Russians go for that ‘strong’ thing not sure Poland is the same there. (Not battling history with you I won’t win but the cultures like anything are different. Look at where you are in TX vs. NJ or NYC, eh?)

          1. JLM

            .When your first grandchild is born, you will adore it whether it is in Philadelphia or Austin.When Reagan and Gorbachev worked their deal, it was driven by a series of letters written between two grandfathers.We will either catalog the things we differ about or the things we are the same about.Everybody likes being free and any form of government which provides greater freedom will be more attractive than a despotism.The only guys who really like despots are despots and their cronies.JLMwww.themusingsofthebigredca…

          2. sigmaalgebra

            Everybody likes being free and any form of government which provides greater freedom will be more attractive than a despotism.Looks to me like this claim fails for the left wing of the Democrat Party, Naaaaasty Nancy, The San Francisco Treat, Alexandria Ocasio-Cortez, etc.

        3. rainmaker

          Speaking as someone who lives in the UK, I’d hardly call the House of Lords democratic, it’s completely unelected and many Lordships are just given out as political favours. But other than that, JLM’s comment is spot on, as always!

    2. jason wright

      I was surprised to read this week that the US imports more oil from Canada than Saudi Arabia.Once upon a time London pushed the Ottoman Empire out of the Arabian Peninsula and made it a protectorate of the British Empire. London supported the return of the exiled Saud clan in their wars against the Rashidi clan. If things had turned out differently the place would now be known as Rashidi Arabia, but the ‘civilisation’ would be much the same.There was a time between 800-1200 AD when this part of the world was a leader in mathematics, medicine, astronomy (why many stars have Arabic names e.g. Aldebaran). We should remember that the Al Saud dynasty is not Arabia or its long history. Every empire falls.

      1. JLM

        .The advanced civilization you describe is not what took root in the desert of Saudi Arabia. It is a perfect example of why the Saudi Arabian government is so horrific by comparison.They are not rightful heirs of this advanced civilization. They are goat herders who won the Oil Powerball.JLMwww.themusingsofthebigredca…

        1. jason wright

          Sunny afternoon is Austin. Enjoy it, if you’re there.

          1. JLM

            .Finally, the water from up the watershed in the Hill Country is still flowing. Lake Travis is at the 5th highest level since 1942. The damage in the Hill Country is enormous.JLMwww.themusingsofthebigredca…

          2. JamesHRH

            That’s been tough to watch,

      2. JLM

        https://uploads.disquscdn.c…All of the Canadian oil – about 4.5MM barrels per day — comes through pipelines.The American oil industry in Mexico was nationalized in the late 1930s just before WWII, so we don’t have many pipelines from that country.I want to merge the USA, Canada, and Mexico, but Wm Mougayar has been resisting my efforts.Now that the USA is allowed to export crude, we need as much Canadian oil as we can get.JLMwww.themusingsofthebigredca…

        1. JamesHRH

          Out enlightened leadership in CAN just made new energy projects dependent on an inclusivity standard that no one can define ( Bill C69 ).Its passed parliament.New pipelines blocked by inheritors of WalMart and a few other select US family fortunes who fund green extremist movements.Alberta crude selling @ 30-40% less a barrel than WTI.I sound like @kidmercury but it’s true stuff.Wish we could help.

    3. Matt A. Myers

      The issue is that once money and currency/money was invented, the system of barter – of really knowing who or where (more accurately, more closely tied together) that product came – which had accountability, no longer had accountability. The idea that you could buy a candy bar in your local store and be funding/supporting a war in another country without knowing it.Blockchain could potentially solve this (sans Ponzi-Pyramid scheme structure), however it’s a matter then of being prompted/shown what money is in along the chain, who’s paid and profits from it – so then individuals can make decisions to buy a different product, from a different supplier who isn’t supporting things they disagree with.This is likely to happy through centralized, transparent organizations, before nation or worldwide effort is possible – a bit of a chicken-egg problem, where most individuals won’t want to disclose their spending fully – however an organization may use that as a competitive advantage; it’s of course also used, at least short-term, as an advantage for companies keeping their supply chain hidden; Apple recently disclosed their suppliers, I’m not sure if their list is complete – and you won’t find out the economies of scale pricing you get, likely good enough that you could assume they indirectly “own” their suppliers.If this transparency was required by law then we’d be empowered to make these decisions – otherwise that lack of transparency gives a competitive advantage to those who are willing to take tainted product by bad actors (who’d be willing to sell it below market value) – and then creates so much confusion and an inability to easily understand where everything is sourced that looks or feels more like chaos than order, and where no one could reasonably be expected to keep track/manage it all on their own.I wonder if nuclear power is actually necessary. It’s huge value, huge risk vs. decentralized/dispersed solar panel and other renewable energies – that perhaps doesn’t reach the exact same economy of scales that a nuclear power plant can reach, though I imagine it’s close enough that the less savings from a reduced economy of scale better than or perfectly counters the risk – no risk is of course invaluable, priceless, if we are to include that in the calculation; we can plan and design security systems around these nuclear-bombs-waiting-to-happen, however the cost and security worries of bad actors infiltrating, even over say a 40-100 year period they may plan for in their next chess move, isn’t really worth it, is it? I think what Elon is doing with Tesla et al is the future. The cost of energy production is down low enough that the individual (enough of them, and more and more) can now afford sustainable systems – vs. having to amass many many billions through taxes.

      1. JLM

        .Not sure how the anonymity of blockchain provides any information as to who is actually involved in a transaction. Please correct me.Pres Trump’s revised USMCA – former NAFTA – makes a bold step as it relates to worker wages through the stipulation that 40-45% of the value of any vehicle exported to the US tariff free must be constructed in a country in which the prevailing wage in the local area is equal to or greater than $16/hour.This provision clearly targets Mexico wherein NAFTA brought us $2/hour wages with a NAFTA minimum wage of $4.15/hour which resulted in more than 840,000 manufacturing jobs moving to Mexico.Apple is in the same predicament. They are making their products overseas in factories which employ children and women in slave labor conditions with horrific environmental records.Apple is delivering a luxury, high tech product with a price structure which leverages these abuses to create substantial profit margins. They are ghouls.A kilowatt doesn’t care who its parents are. When solar or wind can be affordable, competitive, and can overcome the issue of what to do when the sun doesn’t shine or the wind doesn’t blow it will be a main source of energy.Right now, the issue of nuclear power is primarily a matter of political will. The numbers are conclusive.JLMwww.themusingsofthebigredca…

        1. Matt A. Myers

          Sorry I should have clarified: the value of blockchain would be to eliminate fraud within the chain of information, not for the purpose of anonymity.Worker wages/hourly wages is the wrong conversation that goes at least one step too short – so it acts as a distraction for the populace; increased wages simply means every other system of profit increases their price, and therefore capturing any recently redistributed value.The goal is transparency and accountability throughout the supply chain, and transferring value from autonomous systems to the general population – and then women and children – or anyone who doesn’t want to – will need to work in order to survive.Could argue the exact same about solar and battery storage, and then I’d go back to my previous counter-argument that is the slightly better cost with the economies of scale + huge risk worth it compared to slightly less good economies of scale and no risk?

          1. JLM

            .Wages are a market function. There is no real connection between minimums and what can be earned. Earnings should be a function of competition and value delivered.But, when wages start at some minimum then they rise from that level.Nobody is going to transfer value, they are going to earn more of the pie through hard work.All a person needs is a chance. After that they are responsible for themselves.JLMwww.themusingsofthebigredca…

          2. Matt A. Myers

            You’re right that they need a chance, however the system is rigged currently – they don’t have a place yet to “vote” with their dollar, into a system within the status quo, where they can know they won’t be taken advantage of as badly as most currently are by the constant negative pressure on the quality of life from prices artificially being increased. A large shift, adjustment is coming, and it won’t be through governments that are mostly stagnant due to political lobbying and indoctrination of system design over many many decades – it will be through private organization.We’re starting to talk passed each other, so going to bow out of this conversation otherwise.

    4. Salt Shaker

      Like anything else, there’s a threshold of acceptability w/ world events. Generally, the farther away from us the less interest or outright distain transpires, even on a short-lived basis. Wrt the Saudi’s, the culpability here is way too direct and damning. Hard to spin this one. Has a line been crossed? I think so, but for the masses perhaps hardly on the scale of importance vs. other variables (economy, immigration, etc.) We like to preach here in the U.S., even though there are many datapoints indicating we too are hardly Holier Than Thou. Nothing short of outright condemnation and penalties will be acceptable. Not everything is or should be measured in “deals” or in economic terms (though too often that is the case).

      1. sigmaalgebra

        When thinking about the Saudis, also need to think about the Iranians, Iraqis, Turks, Syrians, Russians, Israel, etc. and not just oil but also “the bomb Dimitry, the hydrogen bomb”:https://youtu.be/6T2uBeiNXAo

      2. JLM

        .There are things which are attributed to a “state” which the “leader” of that state can disavow. In this instance, the secret – the Saudis need to work on their “secret” stuff – hit squad was all members, some current, of MbS’s bodyguard detail.Pro tip: If you intend to kill somebody and don’t want to be connected, don’t send your own recognizable bodyguards to do it.In this instance, the direct connection with MbS is a huge problem. One day you’re sword dancing with a guy and the next day he’s preposterously denying he killed someone.Putin, when he kills people, uses nerve agent and doesn’t have the people from his own bodyguard detail do the wet work.The Israelis have been killing Iranian nuclear scientists for 25 years. So nobody is losing their cherry on this cutthroat business.No reason to be surprised. It is happening all the time. Egypt with the Muslim Brotherhood killed thousands. After the MB got run off, another thousand.I think MbS has to go. Nobody is indispensable.The Saudis are not very well grounded in the world.JLMwww.themusingsofthebigredca…

    5. yazinsai

      Your comment is hateful, and your understanding of Islam and the Quran is flawed. 1 in every 6 people in the world is Muslim and if what you said were true, we’d have many more “infidels with burned eyes”

      1. JLM

        .My comment is hateful. Much of Islam and the Quaran is hateful.I have read it cover-to-cover 4 times and I can refer you to the passages which I describe. Still, I am an inquirer and no expert.The number of people who self-identify as Muslims is not as important as the number who fail to condemn the worst parts of Islam on display in the Middle East such as the defenestration of gay persons and the immolation of the Jordanian pilot.The fact that these acts were done for broadcast to the world makes them even more unimaginable.While ISIS — and its unspeakable atrocities in the name of Islam — is not representative of all of those who believe in Islam, what is true is that the Muslim world has not mounted an attack against the kidnapping of its religion and the brutality of its application based on the unspeakable violence which is supported by the Quaran.ISIS is polled as having active support by approximately 15% of those Muslims who self-identified as “devout Muslims.” PEW Research Center poll of Dec 2015.The hadiths of Muhammad document many of these atrocities — their techniques. One is condemned to be brutalized by Islam and under Islam for the sole crime of being a non-believer, an infidel.189. The angels smite the face and backs of disbelievers, saying: “Taste the punishment of burning!” 8:50The entire subject is hateful.JLMwww.themusingsofthebigredca…

    6. KB

      Fred, I would say that JLM’s comments are in violation of your comment policy (We do not tolerate racism, sexism, and hate speech of any kind. No spam or token offering promotions are allowed):”If you have never read the Quaran, please don’t let another day go by until you explore the ritualistic manner in which this document directs the castration and burning out of the eyes of the infidel. You will love it. It’s just like other peaceful western religious practices – like baptism or communion. Wonderful views on the treatment of their own and infidel women – bit primitive, but very clear. Take away oil and these people would be wandering the desert like the savages they are.”The way I read JLM’s comments, he attempts to demean 1.5B muslim people (who read and choose Quran as their holy book) as savages. Or maybe he attempts to do that only for Arabs or Saudis. I am not even sure if he knows the difference. Either way, his comments are divisive, prejudiced and hateful.JLM, You seem to make a living as a leader of people. Ironically, as a CEO coach! As a CEO coach who likes to call and promote himself as -TheBoss. LOL. Shame on you.Here is some education for you:1) Obviously, no religious book written 1500-2000 yrs ago should be interpreted in the literal sense today. Just read / watch this and you will understand why.https://bigthink.com/21st-c…But you probably already know why. You probably just prefer to simplify, divide and conquer, kinda like Donald, just so you can feel good and go on with your own self-deception (that you are better than others).2) And while we are educating you, you should also watch this video to learn why nuclear is not the answer but solar is:Clean Disruption – Why Energy & Transportation will be Obsolete by 2030https://www.youtube.com/wat…If you don’t have an hour, just watch minutes 46 to 50 to learn why nuclear is not the answer but solar is… (Hint: the cost of energy produced by solar on your roof and stored in your battery will be cheaper than the cost of transmission).JLM, I wish you much enlightenment and healing from your own deep wounds and prejudices as you seemingly leads others on your hateful (i am better than you) path…

      1. JLM

        .There is much to hate about the Saudis and those who bastardize the teachings and writings of Islam. I think your argument is not with me, but with those who act upon those teachings in the Quaran.I plead guilty to hating the Saudis – the murderers – to the extent they murder American green card holders with American citizen children. I am first in that line.I plead guilty to hating ISIS, Caliphs, caliphates, and other radical groups who use the Quaran to justify their unspeakable acts — beheadings, immolations, drownings, casting gay people out of windows (defenestration). First in that line also.I also call to account those devout seeming faithful Muslims who do not condemn this bastardization of their religion. I do not hate them, I urge them to differentiate themselves from those who do harm in the name of Allah pretending to adhere to the Quaran. This is hardly hate speech.I feel the same way about Catholics who look the other way in the face of the child molestation scandals.As to solar as a means of power, I support it when it is cost effective, and can deal effectively with the issue of clouds, shade, and nightfall.Because people discuss subjects which involve hateful acts does not make their utterances hate speech. I wish for the bad actors justice.JLMwww.themusingsofthebigredca…

      2. Adam Sher

        I interpreted JLM’s comments about Islam as being directed at the Saudi’s and Iran’s government’s implementation of it.

        1. JLM

          .The topic of my comment was, of course, Saudi Arabia.Saudi Arabia is the most influential location for Islam as it is the protector and custodian of the Two Holy Mosques – Al-Masjid al-Haram (Mecca) and Al-Masjid al-Nabawi (Medina).The Saudi form of Islam (Wahhabis/Salafis) is a minority in their country, but it is the religion of the Al Saud family which controls the country.It, more than other versions of Islam, preaches jihad.Islam is, of course, the Saudi state religion and it is illegal to “proselytize” — preach — any other religion. Non-Muslims can be incarcerated for possessing or distributing the Bible.The actual title of the King is – “Custodian of the Two Holy Mosques” which sort of sets the tone.The very first Saudi state — formed by Muhammad bin Saud and religious leader Muhammad ibn Abd al-Wahhab — was a virulent religious state. It was destroyed by the Ottomon Empire.The Ottomon Empire was destroyed by World War I.The House of Saud again took control of things by 1930 using the same secret sauce of Wahhabism (Salafism).Oil was discovered in 1938. It was the largest source of crude oil in the known world. It catapulted the House of Saud from a bunch of nomads to the big leagues.The rest is history.JLMwww.themusingsofthebigredca…

    7. Rob Larson

      I soooo agree with you on the desire to merge US with Mexico and Canada. That would be amazing from an economic boon and general prosperity perspective.A fantasy, obviously, but still it’s too bad that we seem to be the only 2 people who think that way…

    8. sachmo

      You’ve written your own counterpoint as to why Iran is not in fact the largest state sponsor of terror.

      1. JLM

        .Bit of an error of composition – the Saudis are doing things to their own citizens and former citizens. They have always been huge funders of terrorism on an individual basis – individual Saudis, but have never really taken any direct action as a state.Iran is in a league of its own by providing support, training, and leadership to Hamas, Hezbollah, Islamic Jihad, Popular Front for the Liberation Palestine, various Shia militias, and the Quds. The Quds has both a direct military role and a cyber role.The Houthis – who can forget the Houthis?They have been involved up to their necks in Bahrain, India, Israel, Iraq, Kenya, Argentina, Thailand, France and against the US globally.With their withering economy, we have a chance to strangle them financially.We have no real relationship with Iran, but we have a decent relationship with Saudi Arabia through military ties and business.I have no brief for either of them. I do think we can make the Saudis behave, but not the Iranians. We may get a chance to neuter the Iranians militarily if they attempt to close the Straits of Hormuz.JLMwww.themusingsofthebigredca…

    9. JamesHRH

      Normally, I would take this level of condemnation with a grain of salt.Fortunately, Canada produced this guy – https://en.m.wikipedia.org/… – and I have been exposed to his exceptionally grounded views on the Middle East.I don’t think he would disagree with you here.

      1. Frank Traylor

        Thanks James. Gwynne looks like a good one to follow.

  9. LE

    I don’t claim to have entirely clean hands in this regard. When we sold our Twitter stock before the IPO many years ago, it turned out the buyer was fronting for gulf interests. I found that out after the fact but that doesn’t absolve me of anything. I could have asked the questions before executing the sale.I don’t know how you can say that you don’t have clean hands because you didn’t ask (ie demand) to know who the end buyer was. Would it be cleaner if you had asked? And then what do you get? An agreement that identifies the (1st) buyer? What if the buyer has a legit reason to not be identified? What if they won’t give it to you? What if they simply setup another shell company and then pass it through them? What does your agreement then say that nobody can ever sell it to a certain entity? Not going to happen. Someone would be foolish to agree to it. Obviously that is not only not practical but not possible. So all you are really saying is you will ask and then at a certain point you will feel (or feel better) about saying that you did the right thing (if you want to call it that).Recently I bought a social media handle for a well known company from a well known person. That is not allowed by the rules of that particular social media company. However it was easy to game around that so that no money changed hands for the handle. The seller also wanted to know who the buyer was. I said ‘ok I will tell you who it is’. I could have easily gotten around that requirement in any number of ways. Would be trivial actually. I have companies I control just for that purpose. Or I could just make up a new one in a flash. I didn’t have to because it didn’t matter in this case if the buyer was divulged to the seller. In the end the seller didn’t even care. I think the assurance that it would be divulged was enough to assuage their fears (of not getting enough for the handle).Lastly I don’t even see how this applies to selling stock (as opposed to taking investment). When you sell stock someone is buying and you never know the buyer. If you go to sell your car are you going to run a background check on the buyer? What if you are trying to sell a piece of real estate? Are you going to limit (assumes even legal) who you will sell to? So then take a lower price (in theory) by restricting the market? Where do you draw the line.All sounds good until you get to specifics. Also maybe you can afford to do business this way which is great. But the vast majority of people in business can’t operate this way.

  10. Tom Labus

    It does seems odd that this type of cash would seek out highly speculative funds to invest their reserves. These guys usually prefer a rigged game. The world is swimming in cash expect for those who need it most.

  11. Sebastian Wain

    But once the company is public or acquired by another public company it is impossible to solve that issue. Am I missing something? Why an entrepreneur would be so interested in the early stage investors if at the end they can come from everywhere?

  12. sigmaalgebra

    For… warm our planet with fossil fuels.Ah, the empty set!(1) Climate ScienceThe climate science community built models and made temperature predictions. By now nearly all the predictions have been seen to have been wildly too high and, thus, junk science. E.g., dozens of the predictions and the actual temperatures were summarized inhttp://www.energyadvocate.c…In science, when really bad predictions are made, we junk the science.(2) Ice Cores Show Warmer/CoolerIce core records show that over the past 800,000 or so years, the planet was at times warmer than now and cooler than now, i.e., temperature changes are nothing new with plenty of changes well before humans were burning fossil fuels.(3) Recent Global CoolingIn spite of the fossil fuels burned in WWII and in the recovery, from about the end of WWII to the 1970s or so, there was actually some significant cooling.(4) Sun SpotsThe main, relevant explanation for temperature changes over at least the past 1000 years or so is variations in the rate of sun spots. There is a serious theory for just why sun spots would cause global warming. The sun spot data fits the temperature data, and the fossil fuel data does not.(5) Rationalism and the EnlightenmentIf we set aside the lessons of The Enlightenment, rationalism, science, and solid, credible, objective evidence, then we will be back in the Medieval dark ages with irrational superstitions, quack medicine, and nonsense such as killing people to pour their blood on a rock to keep the sun moving across the sky as the Mayan charlatans did.(6) Kick in the Rotten DoorIt does appear that there are lots of people in the left wing of the Democrats who want us to set aside rationalism so that they can implement nonsense policies to turn the US into a “rotten door” that they can kick in to bring their dream utopia of communism.(7) FreedomPeople can flush The Enlightenment, rationalism, and the importance of solid, credible, objective evidence and believe whatever they want. Apparently some people do that.

  13. jason wright

    for any savvy entrepreneur/ VC fund thinking about taking financial capital from the desert a question to ponder (but not for long) is how much added value can such a source possibly bring to the endeavour?

  14. JLM

    .It is a little naïve to suggest that the world is dying to invest in high risk ventures like venture capital. Even amongst the biggest pension funds with the most secure capital base, the allocation to venture and real estate is often less than 5%.Flight capital — in my lifetime, money coming from South Africa on the advent of the end of white rule/apartheid, eastern Europe on the prospect of war, the Middle East on the advent of more strife, China more recently because of the uncertain political fortunes — likes stable, big ticket investments wherein the capital is safe.When money wants to remain anonymous, it is the easiest thing in the world to do.It can obscure itself by investing though vehicles which are “one-off” single purpose funds which invest in other funds.It can hire intermediaries and enter into any of a number of different contractual arrangements.When the Japanese first came to the US in large commercial real estate, they used the trust department of big international banks to represent them. When you did a deal with them, you did it with Citicorp trust account with an irrelevant name.Money is mysterious when it wants to be.JLMwww.themusingsofthebigredca…

    1. tys0n

      You don’t understand capital. It’s not anonymous, it’s backing and trust in the form of dollars. Consider it a reverse credit with venture capitals owning the credit score. You want to mask the scoreboard and just see what goes where? Wtf. Stop posting dude.

      1. JLM

        .Of course capital is anonymous. Freddie’s very blog post proves it.He doesn’t identify his LPs when he invests their money. That’s why his CEO asked the question as to whose money it was in the first place.That doesn’t fit the definition of anonymous in your book, exactly why?JLM

        1. tys0n

          Don’t overthink it. Dude fucked and his only chance at a retainer for a lawyer is not to snitch up so he’s snitching out.

          1. JLM

            .WTF are you talking about, DUDE?JLMwww.themusingsofthebigredca…

          2. tys0n

            This post is a reads like a press release adjusting blame from investor guilt. Blame the bad actors, tank the venture, try to exit with a clear head and quick to drop specific names. Obvious adjustment of guilt and a attempt to clear higher ups of involvement. This post is in no way helping AVC in their investing plights and honestly I still it’s a joke or a very poor outing. How would any other investors be assured of privacy? Or even mention it in the first place? Sounds like a rumor more than fact being propagated from the person who would benefit from it the least unless they were in finical or legal trouble. Unless this dude has his head so far up his ass. Which is obvious considering mentioning crypto on his twitter stake sell post.Insane. You know about ROE overseas right? You think troopers of any branch just walk around Engaging without following those? No one in this world has a license to kill. You are veteran correct? Come on sir. This is weird.

          3. JLM

            .The US military is the only force which fixates on rules of engagement.This wasn’t US military and they weren’t following any rules of engagement no more than Putin’s SVR are following rules of engagement.JLMwww.themusingsofthebigredca…

  15. burtonator

    I’m on the opposite side of the coin here.My company, Datastreamer, provides data feeds for social media, blogs, news, etc to social media analysis companies.There are good companies in the space of course but there are also your fair share of Cambridge Analytica-style companies that are absolutely bad actors.We do our fair of vetting to make sure companies that license our data do so without violating our ToS but we also get companies approaching us hiding their true intention.I’m 99% certain that 2-3 years ago Saudi Arabia approached us when they were building our their social media analysis platform.Their questions were – disturbing. It was really clear that they were interested in tracking down people based on their ethnic and religious background. Considering the source (Saudi Arabia) we walked away from the deal.This would have been a HUGE chunk of revenue for us. Like 40% of our total revenue…They also KNEW why we backed away because they came back essentially saying “money is not an issue” with regards to the pricing.It’s a double edged sword here. We’re hurt, and our competitors – the unethical ones – are actively rewarded.We need a solution to this problem. It’s essentially a too big to fail issue.You can’t fight countries like Saudi Arabia or China in the current climate. It’s just far far too profitable to do business with these counties, sell them weapons, sell them data, etc.

    1. jason wright

      I’ve always suspected Alexander Nix and Cambridge Analytica to be a front operation for the British security services. It feels so much like an MI6 venture. The manipulation of outcomes to serve the continuation of the ‘realm’ (whatever modern working definition that might now be is anyone’s guess) is exactly the remit of the secret state’s agenda.

    2. kidmercury

      great comment. thanks for sharing.

  16. dan_malven

    Does anyone else think that Softbank Vision Fund will have a harder time deploying their capital because of this revelation? Saudi Kingdom is heavily invested/involved in the Vision Fund. If companies believe that their ability to recruit the massive numbers of employees needed to sustain growth is damaged by putting Saudi money on their cap table (even if indirectly via the Vision Fund), then I believe they will start turning down offers from Softbank. For companies of the scale that Softbank pursues, there are plenty of other sources of capital that don’t carry the recruiting-drag that Softbank will now be bringing with them.

    1. JLM

      .Not picking sides, but 10 days from now nobody will even remember what happened.JLMwww.themusingsofthebigredca…

      1. Lawrence Brass

        Just the other day you wrote about the powers of the pen and the gun. This was a case where the pen succumbed under the force of the gun. Or maybe in this case, the scimitar.State terrorism or state sponsored terrorism is nothing new. An agency that ran amok isn’t either. For an amoral, those that can’t and don’t differentiate right from wrong, terror and murder may be a specialized tool in their tool chest.We still don’t know in which category will the recent events be tagged in history. We could sweep it under the carpet as we usually do, but I know that it is wrong and I care.It is true, we forget. That is why its important to remember and to know who is who. That is why once in a while I look at the past and remember.https://www.washingtonpost….

  17. JLM

    .https://www.independent.co….This is more common than anyone wants to believe.Assassination of a journalist who revealed the Panama Papers scandal with a car bomb. A freakin’ car bomb.JLMwww.themusingsofthebigredca…

  18. I can't stand this guy

    I passed on conversation with In-q-tel and would expect anyone with moral fiber to do the same.

  19. Kent Karlsen

    Easy big money = thumb of rule is that low knowledge will follow this kind of money. Also lower ethics to be expected, as easy money is often criminal money stolen from the people. I am really happy to learn that american entrepreneurs ask for LPs behind VCs (better late than never). Like the Norwegian $1T Wealth Fund make all investments open for the public, and there are now and then some disputes where to not invest even if profit is good: https://www.nbim.no/en/the-

  20. WA

    I am constantly asking – how did this country wind up as divided as Sunnis and Shiites? A divide which now appears even in the intellectual, creative and entrepreneurial sanctuary of AVC space relationships and community bond. Yet the over all civility between dissenting opinions and personal value systems reflects the cohesive power of what this community has achieved in its evolution. My altruism finds solace here as a place many members agree to disagree. And I haven’t yet seen a Sumner caning…

  21. romeobravo

    This gets even more thorny given what Brett Cavanaugh was subjected to. Can you go through the life history of every connected LP and look through their high school yearbooks, talk to people they partied with in high school, college, etc and verify that none have had any sexist, racist, other phobist behavior their entire lives? And what if they have? Do you conduct an investigation? There is a rabbit hole here and once you go down it, it leads a long way down.

  22. Adam Parish

    That’s some pretty amazing transparency. Thanks for sharing.

  23. kidmercury

    if people are really serious about turning down money, they should come out and state their policy, like you see a lot of companies do with diversity. the problem though is that diversity is easy, everyone can just say they want to be friends with everyone and there is no cost to making this statement. saying who you are going to take money from and who you are not going to take money from is a much murkier subject where the consequences are far greater.saudi is far from the only corrupt regime out there. china’s organ harvesting is just as brutal if not more so than the jewish holocaust. yet here we are with google dragonfly and silicon valley’s increasing interest in pleasing whoever needs to be pleased to get access to the chinese market.of course there is also the US government, and all the pentagon contracts tech companies can’t get enough of. killing innocent kids in the middle east is a lucrative business…..the world beyond the nation-state can get here soon enough.

  24. bystander

    Nice article. I wonder what will happen with *private* investment money that originates from e.g. China or countries like Saudi Arabia. That is, money that belongs to an individual rather than, say, a sovereign wealth fund. It seems to me that such individuals might well find themselves in the unenviable position of having money to invest but few companies outside their own country willing to accept it.

  25. KB

    Fred, I would say that JLM’s comments are in violation of your comment policy (We do not tolerate racism, sexism, and hate speech of any kind. No spam or token offering promotions are allowed):”If you have never read the Quaran, please don’t let another day go by until you explore the ritualistic manner in which this document directs the castration and burning out of the eyes of the infidel. You will love it. It’s just like other peaceful western religious practices – like baptism or communion. Wonderful views on the treatment of their own and infidel women – bit primitive, but very clear. Take away oil and these people would be wandering the desert like the savages they are.”The way I read JLM’s comments, he attempts to demean 1.5B muslim people (who read and choose Quran as their holy book) as savages. Or maybe he attempts to do that only for Arabs or Saudis. I am not even sure if he knows the difference. Either way, his comments are divisive, prejudiced and hateful.And, JLM, You seem to make a living as a leader of people. Ironically, as a CEO coach! As a CEO coach who likes to call and promote himself as -TheBoss. LOL. Shame on you.Here is some education for you:1) Obviously, no religious book written 1500-2000 yrs ago should be interpreted in the literal sense today. Just read / watch this and you will understand why.https://bigthink.com/21st-c…But you probably already know why. You probably just prefer to simplify, divide and conquer, kinda like Donald, just so you can feel good and go on with your own self-deception (that you are better than others).2) And while we are educating you, you should also watch this video to learn why nuclear is not the answer but solar is:Clean Disruption – Why Energy & Transportation will be Obsolete by 2030https://www.youtube.com/wat…If you don’t have an hour, just watch minutes 46 to 50 to learn why nuclear is not the answer but solar is… (Hint: the cost of energy produced by solar on your roof and stored in your battery will be cheaper than the cost of transmission).JLM, I wish you much enlightenment and healing from your own deep wounds and prejudices as you seemingly leads others on your hateful (i am better than you) path…

  26. Donna Brewington White

    This post deeply resonates.In the wake of Theranos (as one of several triggers), I am reflecting on my business. This will influence who I accept as clients in the future. I have never knowingly entered into a client relationship with a bad actor. But I am intensely loyal to clients and once in that relationship it takes blatant evidence for me to walk away. I’ve had to fire a couple in recent years. In these instances, the relationship began when the client was an early stage startup with little if any significant presence on Glassdoor (which BTW can at times be misleading if not read carefully). It took experience with each company and a few hires for the issues to become blatant.Given the nature of my work (executive search), I’m thinking long and hard about how to avoid these situations. Too much at stake.

    1. Adam Sher

      I see your situation as different than a GP/LP relationship. In your situation, the reputation and behavior of your clients reflects upon you; therefore, it is important to be careful with whom you lay.In Fred’s scenario, his LPs are removed from his investments. For example, if one of Fred’s LP’s is Koch Industries, and Fred invests in CleanTech, who does that reflect poorly on? If Fred allows USV’s attorney the proper latitude, USV will have more than fulfilled its obligations under KYC to not accept money from money-laundering or sponsors of terror.

      1. Donna Brewington White

        Thank you, Adam. Admittedly, it’s a loose comparison but I’ll take my lessons wherever I can find them. 🙂

        1. Adam Sher

          I’ve been mulling over this for the past two days and I move my position and think GP’s should better discriminate from whom they accept money. One reason is that I’ve been a GP and KYC I do not view KYC as an effective measure. Another is that many LPs in the HNW and institutional world invest together (club investing). To them, appearances matter, and they often speak amongst each other. Where I’ve seen the most potential for shade is in family offices (I realize Sovereign Wealth Funds are probably even bigger but I don’t have experience there).Taking my earlier example of Koch Industries as an LP further, there can be a benefit to accepting money from a source you morally or politically disagree in the same way governments keep back channels of communication open with regimes they denounce.

  27. Pointsandfigures

    They are private family capital. They are not public pensions, nor even public corporations.

  28. JLM

    .You mean like other than the general right to privacy as enshrined in the Constitution and upheld by every court since its inception. Other than that?Of course, people have a total and complete right of privacy as well as the right to contract for any condition in which they can bind any other person with a valid contract.JLMwww.themusingsofthebigredca…

  29. JLM

    .Uh, Paul, you are going to want to read up on the Fourth Amendment of the US Constitution.”The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”This is the wellspring from which an overzealous government is admonished not to fuck with its citizens. It is the mother lode of all privacy rights.Other than a FISA Court, which is probably unconstitutional, the government cannot look at your cell phone bill without a finding of probable cause of the commission of a crime.So, yes, this is sort of explicit and upheld by the courts.You may also want to read up on Roe v Wade which was decided based on the Due Process Clause of the 14th Amendment which recognized a woman’s right to privacy on the subject of abortion. Abortion is only one of many such privacy rights which have been similarly decided. It is just the most famous one.Any person can organize their affairs in such a manner as to prevent even the most curious persons from identifying a personhood at some point of ownership.You may own assets in the US and invest money through a series of domestic/foreign trusts, multiple stock corporations, or other legal entities to obscure the ultimate nature of the ownership.You may pay US taxes at the lowest level of corporate structure thereby totally obscuring the ownership of an asset. The IRS doesn’t care who pays the taxes as long as they are paid and paid in accordance with the appropriate rates.You are confusing regulatory requirements with privacy. Even in the application of SARs, the reporting is limited to the actual entity whose money is being transferred as a matter of first impression.If you and I owned a Dela Corp parent with a Dela Corp wholly owned subsidiary and made a $10,001 deposit, the deposit SAR would be reported only in the name of the Dela Corp wholly owned sub.Real estate, of which I was a high level practitioner for decades, has the exact same ability to obscure ownership. It is a little more delicate as individuals, like me, want to be able to flow the depreciation and interest deductions through to the real people eventually to avail one of their tax benefits.The IRS requires a 30% tax withholding upon sale of a real asset until it is proven to their satisfaction that the US taxes are paid. They don’t care who pays it and only the American partner is liable for it.The IRS gives you a “taxes paid” certificate and you are off to the races.JLMwww.themusingsofthebigredca…

  30. PaulRoales

    Your right. I remember now why I stopped commenting on AVC.

  31. sigmaalgebra

    Nice! Business Law 101. Kept!

  32. LE

    the government cannot look at your cell phone bill without a finding of probable cause of the commission of a crimeAlthough not common (actually though how would I know?) what they can do is find an adjacent reason to have access to what they want.Not to mention (once again no way would I know how common) that the government can fabricate probable cause for a legal search (same as an officer stopping your car – can typically find a legit or non legit reason and swear by it).Now of course there is a difference to what might happen to a typical person with average legal counsel and to someone who has high level legal counsel that can challenge what the government does.Then there is the case of the unknown knowns. For example let’s say hypothetically one of your relatives does a public DNA test and they are able to narrow down that you are related to that person (I mean I can do that right now if I want). So then that fact combined with one other detail gives them enough to get access to your cell phone records in theory.I thought also there was some circumstance whereby the government could discover something about you and execute a warrant because they were actually looking at someone else and uncovered it that way. I don’t remember the legal theory that is called. But let’s say they get legitimately access to person A’s email. And they see that person discussing some scheme with person B. So they then have probable cause to gain access to Person A’s email as well.

  33. JLM

    .You posted a lot of shit which wasn’t right and somebody called you on it and explained it to you?Yeah, I hate it when that happens.JLMwww.themusingsofthebigredca…

  34. JLM

    .One of the things the gov’t can do with a FISA warrant is to “two hop” which means they can surveil the target and the next two levels of contact.In the instance of Carter Page, they could digitally intercept him plus anybody who he emailed with plus anybody they emailed with – two hops. This got them to everybody in the Trump campaign.Trump was right from the very beginning. The whole campaign was being surveiled. The idea that Carter Page was an agent of a foreign gov’t is laughable. The fact that he has never been interviewed, charged, indicted, gone before a grand jury tells us all we need to know.Don’t believe for a second that the NSA and all the telecoms don’t have an arrangement whereby the NSA can come in by a backdoor.The NSA admitted as much.A search warrant — outside a FISA Ct — may require notification of the target. It is often not done.JLMwww.themusingsofthebigredca…