Criminals routinely invest lots of money in losing enterprises. This is called money laundering. They'll take a hit from 30 to 70% or even worse just to be able to get their money back in a way that they can spend it legitimately. They may not even care to win overall, as long as some of the bets pay off that's great. It will give influence and legitimacy.
The hard part is always to find places that will take large amounts of money, no questions asked and that have a gambling element in it which could explain large returns in a plausible way, and in a way that will stay.
That's why casinos are very popular, ditto with antique dealerships, the real estate sector and financial services such as banking.
It's really not that much of a stretch of the imagination to use venture capital as another money laundering setup, essentially it has all the elements of a casino, large amounts of money go in, lots of it disappears and some relatively small bets pay off huge.
Another reason for making 'silly bets' is to diversify whatever the cost, because being the owner of former state enterprises and a bunch of mines always has a risk of nationalization, silicon valley investments have returns in hard currency and on top of that are unlikely to ever be taken away at the whim of some ruler.
http://en.wikipedia.org/wiki/Alisher_Usmanov has an interesting profile and if that's Milners main source of capital there are definitely some pointed questions that should be asked. This is not who you want to be indirectly involved with your startup, assuming that it is true and that this guy really is the power behind the investments Milner is making.
Pecunia non olet but some money is better refused than accepted, 'success' on the back of stealing from the people of the former Soviet Union is not something to be proud of.
The hard part is always to find places that will take large amounts of money, no questions asked and that have a gambling element in it which could explain large returns in a plausible way, and in a way that will stay.
That's why casinos are very popular, ditto with antique dealerships, the real estate sector and financial services such as banking.
It's really not that much of a stretch of the imagination to use venture capital as another money laundering setup, essentially it has all the elements of a casino, large amounts of money go in, lots of it disappears and some relatively small bets pay off huge.
Another reason for making 'silly bets' is to diversify whatever the cost, because being the owner of former state enterprises and a bunch of mines always has a risk of nationalization, silicon valley investments have returns in hard currency and on top of that are unlikely to ever be taken away at the whim of some ruler.
http://en.wikipedia.org/wiki/Alisher_Usmanov has an interesting profile and if that's Milners main source of capital there are definitely some pointed questions that should be asked. This is not who you want to be indirectly involved with your startup, assuming that it is true and that this guy really is the power behind the investments Milner is making.
Pecunia non olet but some money is better refused than accepted, 'success' on the back of stealing from the people of the former Soviet Union is not something to be proud of.