Due diligence and FTX

I was reading that Tiger Global pays outside consultants over $100M per year to conduct due diligence for their funds. Of course, the crazy part to all this is that Tiger invested in FTX and that $38M investment is now worth $0.

I’d love to read the memo that these firms produced on FTX. I doubt I ever will get my hands on one, but naturally I am curious if these memos actually highlighted any of the said red flags that have come to surface.

There’s a lot of shitting on these VCs and funds for investing in FTX right now. Perhaps a lot of it is warranted. But my personal take is that almost everyone would have invested in SBF and FTX if given the chance to earlier this year or last.

There’s a huge crowd of investors out there doing their VC brag tour by tweeting out that they didn’t invest when they had the chance. My question to those folk is that if you knew that SBF was a complete fraud - where were you months ago when all this was happening?

Full on - he had nearly everyone fooled including legendary VC funds who have been doing this for 30+ years. It’s easy to say in hindsight that this was brutally obvious. They had no board, there was no corporate governance or oversight, etc. Actually coming to terms with it would have been much harder.

I can only wonder what would have happened if I had met SBF and was given the chance to invest. My overconfident self perhaps would say that I would’ve smelled that something was wrong and chosen not to invest. The realistic me would realize that 99% of people who met SBF was also fooled and odds are I would have fallen in that 99%.