On Nov 18, 2007, at 4:17 PM, Richard Loosemore wrote:
The majority of VC's do, as you say, want a technology that is sewn
up, from the point of view of technical feasibility. But this is
not always true. There is always a gray area at the fringe of
feasibility where the last set of questions has not been *fully*
answered before money is thrown at it.
This is very much a function of due diligence, which varies from
investor to investor. But as has been noted many times in the VC and
angel communities, there is a strong correlation between the amount
of due diligence and the probability of success. The only thing
surprising is that there are still VCs that slack off on due
diligence. For angel investors it is less of a problem, but VCs can
get sued by their limiteds if they don't do their job.
AGI, unless you have an exceptionally complete technology, will do
better with angels than VCs for this reason. Angels can take
objectively crap odds on a venture, VCs cannot.
I believe this happened in a number of projects during the dot-com
insanity. And I have personally seen, from the inside, business
projects that were started without the money-source being clear
about feasibility at all! To them, it just sounded so plausible
and so great that they felt that it ought to have been possible, so
they bought into it. The real world is just not so clean that
technology is always "evaluated in considerable detail such that
there is little or no risk that it will turn out to be infeasible".
This kind of easy capital is a double-edged sword, as most people who
got it with minimal due diligence found out. An investor with poor
judgment that can give you all the money you want on a whim generally
has the power to exercise that poor judgment with regard to the
direction of your business after you have the money. Trust me, you
*want* smart and savvy investors that will do the appropriate due
diligence on their investments, as it greatly increases the
probability that they will be an asset to your business rather than
an albatross around your neck.
The current venture capital situation is somewhere close to its ideal
point on the cycle for everyone involved. They have plenty of
capital that they are very interested in putting into play, but the
process has not fed back on itself to the point that there is gobs of
money chasing a handful of stupid deal. Lots of deals are happening,
but they are generally smart deals done by smart people. In terms of
raising quality investment, this is about as easy as it gets. If
there is a smart AI play with solid venture fundamentals, it should
be fundable in the current financing climate. That said, I realize
that it is very hard to create an AI play that has solid venture
fundamentals, but that is not the investors' problem.
The one question that hangs over this approach is whether the
result of all that systematic effort really would cough up a fully
functional AGI system. That I cannot say .... but I can also
produce technical arguments that strongly indicate that no AGI
project will ever be able to eliminate that uncertainty ahead of
time (this was the "sorry, no prototype is feasible" argument that
I suggested earlier, and which Ben also subscribes to).
This is a pretty weak argument, amounting to little more than
intuition. If you could characterize the problem well enough to make
that assertion, you could push out an AGI system.
On the other hand, if you have the mad computer science skills
required to produce AGI, maybe your time would be better spent
solving on of the myriad of other important problems in computer
science so that you can have both the quick money and reputation to
fund your own AGI program without having to deal with investors
demanding rigorous business plans. There are other interesting
problems that could be solved much more quickly and flipped for quick
cash without too much effort.
If I am right in this last idea, VCs have a stark choice: if they
want AGI, they have to relax their insistence on a project that
does not have that last "research" step. If they insist on
something stronger, they can kiss goodbye to ever getting an AGI.
Right, because this is not an enormous non sequitur based on an
equally dubious assumption.
In any case, investors are in the game to make money first. That is
why they are called "investors" and not "partners"; they are helping
you make money, not solve AGI. Saying things like this is a good way
to scare off investors.
My claim is that my particular approach reduces the uncertainty as
much as possible.
That seems like a difficult assertion to prove.
Who knows, maybe you are right. But it does very much seem like you
are operating under some delusions about how the venture investment
process works. You don't have to look viable to yourself, you have
to look viable to everyone else. Proving your viability is *your*
job, and it is no one else's fault if you are incapable of doing it.
I empathize, but I figured out that you can accomplish far more by
playing the game according to the actual rules than by inventing your
own rules and expecting everyone to accept them.
If you are smart enough to create AGI, you are smart enough to game
the rules of the real world to your advantage without too much
effort; don't fight it, use it. It is a waste of effort discussing
how things "ought" to be.
Cheers,
J. Andrew Rogers
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