Early investors aren't trying to find valuable, profitable, or innovative companies that will make a lot of money. Their goal is to sell to someone else at a higher price sometime down the line. Therefore the actual reality of the business is not useful, and often purposely ignored if the story seems like it can pull in enough bag holders.
Do you think he would have gotten that far in today's interest rate environment? I mean, are investors paying more attention now, or does the bigger idiot theory still work?
A theory I've read on here is that VC returns come from a handful of hyper-successful firms, and the challenge is getting in on the deals in those firms at all, and the way you do that is by building a reputation as a visionary and generous investor by investing in ludicrous bullshit on founder-friendly terms. From this point of view, money given to Nikola isn't a bad investment, it's a marketing expense.
