TherOhNos: Who Really Gets Hurt When Startups Blow Up?
“The real losers are the employees. They are investing their time and their careers without access to any information. Unlike a fund who may have a portfolio of dozens or hundreds of investments, an employee can only make one investment at a time. The cost of a mistaken investment can be unemployment and the opportunity cost of foregone opportunities. Unlike investors who are making their investments after meeting with the company and performing due diligence, interviews don’t tend to work like due diligence sessions…”
“LinkedIn notes that Theranos has between 501–1000 employees. How much information did they have before they joined? What sort of due diligence could they perform? The answer, as with most other private companies, is almost none.”
tags: startups