This is a linkpost for https://www.brasstacks.blog/explain-im/

Let's say you’re a billionaire. You want to have a flibbleflop, so you post a prize:

Make a working flibbleflop — $1 billion.

There begins a global effort to build working flibbleflops, and you see some teams of brilliant people starting to work on flibbleflop engineering. But it doesn’t take long for you to notice that the teams keep running into one specific problem: they need money to start (buy flobble juice, hire deeblers, etc), money they don’t have.

So, the people who want to build the flibbleflop go and pitch to investors. They offer investors a chunk of their prize money if they end up winning, in exchange for cold hard cash right now to get started building. If the investors think that the team is likely to build a successful flibbleflop and win the billion dollar prize, they invest. If not, not.

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First published:
January 31st, 2024

Source:
https://www.lesswrong.com/posts/vJf9eCdnzbBWi52Zf/explaining-impact-markets

Linkpost URL:
https://www.brasstacks.blog/explain-im/

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Narrated by TYPE III AUDIO.

[Linkpost] “Explaining Impact Markets” by Saul Munn

LessWrong (30+ Karma)

[Linkpost] “Explaining Impact Markets” by Saul Munn