Tomasz Tunguz, a Principal with Redpoint Ventures, talks about how important information asymmetries will become on Quartz. This is particularly interesting because we are in the era of information symmetry. Back in the day, you walk into a car dealership and you get screwed by the salesman because information asymmetry existed; you didn’t know much about cars and the salesman knew a lot. Today, you walk into a car dealership and you’ve done a lot of research online beforehand; you likely know just as much as the car salesman. That’s information symmetry.
Information symmetry is good for all sorts of reasons. It leads to more collaborative and effective negotiations, for instance. But Tunguz is counting on information asymmetry to fund the future success of venture capital. Not necessarily bad, that’s just business, but I don’t see the every-man-for-himself approach bringing loads of innovation to the capital market. Indeed it seems counter to his next argument that VCs need to shift from being part of the financial industry to that of service, and should foster the startup community – of which, he later clarifies, will only be internal communities, of course.