The Big Value Creation Trend of 2015: Q&A with Jonathan Medved

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invest through OurCrowd in private tech companies. During a call from OurCrowd headquarters in Jeruselem, Medved talked about his perspective on markets, unicorns, tech funding trends, and crowd-funding. The following is a transcript of our conversation, edited for style and length.

Xconomy: Let’s start with that slide. What does it tell you about tech funding in general?

Jon Medved: The bottom line on this slide, and the point I was making, is that people who buy stocks have been aware that there is this adjacent area of private company investing that exists a little bit out of sight, out of touch, out of reach. You sort of figured, OK that’s either for really rich people or people who are really well-connected, and I can’t play there. That was OK as long as you could make, you know, studly returns in the public market. It’s not OK anymore.

What’s happening is that you’re starting to see a bunch of different things all at once. At the top of the market are signs of this, call it an Uber bull market. You’ve got people coming in and buying the big private [companies] as if they were public.

Jonathan Medved (OurCrowd photo by Prescott Watson)

Jonathan Medved (OurCrowd photo by Prescott Watson)

People are saying, “Well how can I get a shot at getting into this when it’s [valued] at $20 or $30 million? As opposed to $20 or $30 billion.”

My sense is that we’re on the cusp of a sort of societal change, where this private investing once was really the province of a very small group of people. I mean, how many Americans buy stocks and bonds? It’s like 50 million or 100 million, some crazy number. What’s the number of people who have invested certainly in tech startup companies? It would be like 100,000.

It’s not going to be that way any more. Whether it’s going to change because of crowd-funding or different kinds of regulatory regimes, we’re going to move over the next 10 years to a situation where, when guys get around to talk about stocks, they will talk about stocks and their private company investments interchangeably. That’s the change that’s going to happen over the next 10 years in my opinion.

[Private tech investment] is going to become a more broadly held asset class. And I think this is great. It’s great for people’s checkbooks and bank accounts, and it’s good for tech companies. It’s going to bring new money into the innovation market.

I guess it boils down to whether you think tech is played [out]. I think it’s so not played. We’re in very early days of a very long-term story. If you think we’ve seen it all, we’ve seen nothing. We’ve really seen very little.

X: What’s your take on the stock market in general? Is it over-valued? Are we in a bubble? Or is the bubble confined to Silicon Valley companies?

JM: There’s a lot of froth in parts of Silicon Valley. OK? It would be hard to deny that. On the other hand, I think … Next Page »

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Bruce V. Bigelow was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Follow @bvbigelow

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