A Quote by Whitney Tilson
I have long believed the corporate world is plagued by poor capital allocation decisions.
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Unlike a normal venture fund, we never stop raising capital. We can always absorb new capital on the platform and into the next deal as long as we feel it won't distort the allocation and the pricing.
Accounting consequences do not influence our operating or capital-allocation decisions. When acquisition costs are similar, we much prefer to purchase $2 of earnings that is not reportable by us under standard accounting principles than to purchase $1 of earnings that is reportable.
Empowering innovations require long-term investments, which tie up capital for years and years. So companies are using capital to create more capital, and consequently, the world is awash in capital, but the innovations we need to advance aren't there.
We can extrapolate from the study that for the long term individual investor who maintains a consistent asset allocation and leans toward index funds, asset allocation determines about 100% of performance.
If you go out into the real world, you cannot miss seeing that the poor are poor not because they are untrained or illiterate but because they cannot retain the returns of their labor. They have no control over capital, and it is the ability to control capital that gives people the power to rise out of poverty.
I realized that, after tasting entrepreneurship, I had become unfit for the corporate world. There was no turning back. The only regret I had was having wasted my life in the corporate world for so long.
The financial doctrines so zealously followed by American companies might help optimize capital when it is scarce. But capital is abundant. If we are to see our economy really grow, we need to encourage migratory capital to become productive capital - capital invested for the long-term in empowering innovations.
The tax on capital gains directly affects investment decisions, the mobility and flow of risk capital... the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.
Look at other countries that have tried to have federally controlled health care. They have poor-quality health care. Our health-care system is the envy of the world because we believe in making sure that the decisions are made by doctors and patients, not by officials in the nation's capital.
The tax on capital gains directly affects investment decisions, the mobility and flow of risk capital from static to more dynamic situations, the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth of the economy.
The court has had to take a hard look at our resources and make difficult decisions balancing competing demands for resources. While our current allocation of resources to the Twin Peaks Court may not be ideal, it is an appropriate allocation when all factors are considered. While I realize this will be disappointing news to you, I can assure you the matter was given serious thought before a decision was made.
We also need to reduce corporate tax rates. This applies to small, medium and large businesses. At 35 percent, we have the second highest corporate rates in the world. It restricts the growth of small enterprises that need to plow capital back into their businesses and forces companies and jobs to move overseas.
We believed the world didn't need another commoditized venture capital firm.
There is no corporation in the world that would, in a competitive environment, try and concentrate all decisions at the corporate level.
Capital, never concerned with distribution, is now less and less concerned with production. Capital is driving for power, for the control over markets, lands, resources. Capital, in corporate hands, can move anywhere and thus demand and get the utmost in concessions and privileges as well as the freedom to operate in the interest of ever-increasing wealth and assets.
As I looked across the company, there are three things that keep coming up that we need to work on: culture, our operating rigor, and capital allocation.
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