I don't know if I agree with this. Basically, the argument is that you should borrow money before borrowing becomes difficult. The problem is that it isn't so easy. Heck, if we all knew that the stock market was going to slump in the summer/fall, we would have sold in the spring and bought back in. We didn't know. Most of the best investors didn't know. The chance that a start-up CEO will know is probably nil.

You aren't a financial genius as a tech CEO. Doesn't mean you aren't smart, but it isn't your field. You're just as likely (if not more) to be wrong than right. Even people who make their living this way were almost all wrong this time.

Live frugally, save money, and make plans for rainy days.

Lore has it that Peter Thiel is a financial genius, or at least, would have access to information financial geniuses would be able to conjure. You are right that Max probably has little idea himself about the financial industry. However, his business associates do.

Ultimately, Max is advising to buy cash (raise capital) when it's cheap (bubble) so you can sell cash (spend capital) when it's expensive (recession). Your advice to "live frugally, save money, and make plans for rainy days" reduces to the same, though maybe with a less ambitious connotation.

they're not quite the same. if you raise an absurd amount of cash -- say $50mm on $500mm pre -- your bar for even a 2x return is over a billion dollars, eliminating virtually all your possible exits. especially in this environment.

No, this is advice for preparing for troubled times.

While this works out for the company, how does this work out for the investors? Maybe companies should build a profit.

I can't tell yet but it seems Slide is horribly overvalued, especially with giants like Digg and Facebook's valuations dropping precipitously.

Over investing in companies like this makes it all the harder for the littler company with a legit product.

As far as I'm concerned, Michael Chabon lost it after Wonderboys in a big way.

May be good advice, but aren't they giving it out a little late?

does levchin really have the midas touch? are slide and yelp ever going to be viable? yelp missed the boat, they should have sold out in 2006 when the hype over "local" was peaking. slide will be indeed likely end up as the king of the widget makers...for all that matters. yelp's site and reviews data will likely get bought for a song within the next three years....slide will slide into irrelevance as the widget market flames out