The New Yorker has become almost unreadable for certain political and woke reasons, but from time to time, there is actually a focus on old school and de-political long-form reporting. The November 30th issue, behind the paywall (NewYorker.com), had a piece entitled How Venture Capitalists Are Deforming Capitalism. We’ve curated some juicy clips worth considering that reflect on many related things in the investment world public and private: gross effects of zero cost monetary policy, governance collapse with headline ESG posturing, and who has what incentives to sell you the latest offering.

Note to reader: This line of contrary thinking has not proven remunerative for some time. We did, however, reflect on the NUTS of WeWork from the get-go here, here, and here.

From the New Yorker:

• • “Venture capital has become a lottery,” the former SoftBank executive told me. “Masa is not a particularly deep thinker, but he has one strength: he’s devoted to buying more lottery tickets than anyone else.”

• •  A 2018 paper co-written by Martin Kenney, a professor at the University of California, Davis, argued that thanks to the prodigious bets made by today’s V.C.s, “money-losing firms can continue operating and undercutting incumbents for far longer than previously.” In the traditional capitalist model, the most efficient and capable company succeeds; in the new model, the company with the most funding wins. Such firms are often “destroying economic value”—that is, undermining sound rivals—and creating “disruption without social benefit.”

• • A former high-ranking WeWork executive told me that, by 2018, “our job had basically become to make sure Adam didn’t do anything really stupid or really illegal—the board knew Adam was the key to raising money, and, as long as their valuations kept going up, they weren’t going to risk upsetting him.”

• • Another former high-ranking WeWork executive, who regularly participated in board meetings, told me, “If you review the minutes of our board meetings, you would see that never has there been a board vote that wasn’t unanimous. There was never a budget plan, or a growth plan, that wasn’t approved unanimously. If board members had concerns, they never once officially said them.”

• • Representatives of Morgan Stanley had informed Neumann that they believed WeWork could go public at a valuation of a hundred and four billion dollars, making it worth more than American Express. Bankers from Goldman Sachs were more modest in their valuation—ninety-six billion—but in their presentation to Neumann, they compared him to Mother Theresa, Steve Jobs, and Lin-Manuel Miranda, and lauded the “WeWork Effect” for allowing people to “live a true life,” combat loneliness, and avoid deathbed regrets.

• • Many WeWork executives suspected that the S-1 might cause problems when it became public, but they didn’t say anything, because “there was this massive pot of gold just over the horizon,” one former executive told me. “Basically, we chose willful ignorance and greed over admitting this was obviously batshit crazy.”