If anything that I'm able to bring to the table from Google-fuing helps with the litigation process, that's a plus for starters. The other side of the coin is that I believe there's other entities that deal with/in Bitcoin that are directly related to this/these investing groups. Not only have we witnessed an MO repeated in regards to Bitcoinica, but the same players have operated in like fashion previously with other entities, long before Bitcoin ever came into existence, some of which are still being played out to this day.
Welcome to the world of venture capital and private equity. It's extremely common to find the same group of players in varying combinations investing in start-ups within a certain industry. Venture capitalists know that many of the enterprises in which they invest will either lose money or at best break even. They are looking to recoup that money on the handful of investments they make which are profitable. The terms on which venture capitalists invest are often quite brutal to the outside observer, but money tied up in a failing venture is money which could be better put to use elsewhere.
Every venture capitalist has a long list of investments that didn't pay off - risk is what venture capital is all about. Obviously, venture capitalists aim to minimise risk while maximising potential returns but I've never met a venture capitalist yet who didn't make an investment without an exit strategy in mind.
In a new industry like Bitcoin, I'd be shocked if there wasn't a lot of cross-investment going on. I'd imagine that VCs would also be looking for related investments which would mesh well with Bitcoin. The objective is pretty much to find something new and get in on the ground floor before the world at large realises it has value. I'm not saying that to be an apologist for Tihan, but rather to give a context to your observations. Make no mistake, while VCs might often be called "angel" investors, they play hardball when it comes to the bottom line.
You probably remember, as I do, that this time last year the community was excited about the possibility of newborn Bitcoin businesses attracting venture capital. People were wondering how pitches could be made to venture capitalists and saw attracting VC as a kind of benchmark for how seriously Bitcoin was being taken. This was a community full of ideas but with very little capital to put them in motion. What has happened with Bitcoinica is certainly not going to make other venture capitalists or private equity funds who saw this as a litmus test
more willing to take a risk with funding Bitcoin ventures.
Rapidly expanding businesses need external investors to survive, and the learning curve for Bitcoin businesses has been steep. Look at how many promising ventures have come and gone. Some were poorly conceived and badly executed from the start, but for others lack of money to fund rapid growth was a major factor in their demise. We often forget just how short-lived some of the most brightly shining stars were.
These are lessons to remember for the future. The best idea in the world still needs the right people to execute it and it needs money to fund it through a period of rapid growth. If people accept outside investment in their ventures, they need to put aside their excitement and make sure that they really, truly understand the nature of their agreements and be certain that they're prepared to live with the worst case scenario.
Perhaps what the Bitcoin community could look at doing for the future is putting together a network of mentors who have conventional business experience and who can at least let those considering putting their heart, their soul and their life savings into a new venture know what questions they should be asking themselves. Nobody starts their own business expecting it to fail, but success requires more than just a good idea.
On a lighter note, I just looked for Maria's "Wendon Mews" thread so that we could all laugh at the information her "private detectives" had supposedly uncovered and she's deleted it.
