Today we heard many ideas from different people. Among all the presentations, three presentations, AED, Gary Ong's and Cliquefund were quite "interesting".
AED
I have to say that the idea is good and it is really an application that will create value for the whole community. However, I think that not it may not be able to attract too many users and achieve its purpose. This application is still like a one-time application. Users will try once and they may not try the second time in future. Hence the difficulty to achieve the purpose of this application is how to ensure that users will re-play the game in a certain period. Although I am not sure how to really make this app successful in future, I did hope that we could come up with a really good design and game flow for AED. It will save lives and it will be the way we could contribute to the community as a computer science student.
Financial application
In fact, when I heard the idea of implementing candle stick, I felt a bit sad. I could fully understand what he want and how much he believed that his idea is correct. In fact, when I was young, I also believe that candle stick, wave theory will make a lot of profit for me. However, it was not true. Let me tell you why. There is a financial company in the world. About 80% of its employees are Phds. The aim of the company is to make money in the stock market.How did they make profit in the stock market? All the Phds in finance and mathematics, they hired, will come up with the best prediction model which not known to the public. All the computer science Phds will try to implement them with the most efficient algorithm. However, it was not the end of the story. They will also hire engineers. They will study how to make the data transfer faster. If possible, they will build new hardware and direct implement all the algorithm in assembly code. What's more, in order to compete with time, they try to build a direct connection to the main sever of exchange, which will reduce the physical transaction time. Now let's compare. They have one of the best algorithm and they are almost the fastest one to make "best" decision, and they have enough money support. Even if a single investor could discover a good strategy, with only thousands dollars on hand, each transaction could hardly bring 1% profit. However, for them, even if they could only arbitrage for 0.01% profit, they will invest a billion and the profit will be a lot. Hence now I think that for most of the individual investors, financial market is the place for fun not the place for profit.
Just recall one interesting question read before.
As an investor, do you think that you are better than other 50% of all the investors?
Among 90% people will answer YES.
If you answer NO, then why do you still want to be an investor? Because it will obviously a lose to you.
If you are among the 90% people, who will be the 40% wrong guesses?
If only 10% of investors could make profit in the market, the rest will lose. Are you among the 80% of the wrong guess investors?
Cliquefund
Admittedly, the idea was quite attractive for me. However, later I realized that the idea could hardly be realized the future because they did not have a huge potential market.
1. Are there more VCs or more ideas in the world?
Everyone will have many different ideas and hope to make them true. Without money, some of them could be hardly realized. For all the entrepreneurs, they all have ideas but no money. VCs get many many proposals every year and many of them has almost tried out for months. They are not lack of projects. They really did not need this website to build connection with entrepreneurs.
2. For individual investors, you want to invest in a small company or stock market?
The idea of Cliquefund is try to build a "social" investment website. However, the problem is whether an individual investors would like to invest in this manner.
What is the characteristics of individual investors?
1. they do not have a lot of money comparing to VCs.
2. they did not have enough resource for them to verify which company will grow better in future.
3. they hope to make profit not lose money.
Then what is the characteristics of entrepreneurs?
1. they need money.
2. they could not guarantee the return.
3. fact: most of these start up company will die in years.
Now If you were the investor, will you join the website and make investment? Comparing to invest in the stock market, which more will be less risky?
It is true that some people like risk and would like to take challenge. But compare to self-build investment with small companies, I believe that they will choose to give money to VCs and let them to help you make decision. It will be less risky and more profit, isn't it?
