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To: pfalk who wrote (67611)	4/14/2005 11:49:53 AM
From: Elroy	Read Replies (1) \| Respond to of 77400

Of course it can be both a long term trend AND not cost effective. It can be, but its unlikely. Why would the less effective process become the dominant process in a dynamic economy like the US? The reason it is long term is because once the Venture Capital firms have decided to demand that all startup do their develoment in India, then there will be very few startups that can disprove the wisdom of this strategy (because they will not be funded). But the few US companies that DO do their development onshore will beat the offshore model startups (if your theory is correct), and the VCs will follow the money and come back onshore. The VCs will go with whatever works. I find it hard to believe you don't think the US economy will figure out the superior process. Capitalism will cause the superior model to prevail.

To: pfalk who wrote (67611)	4/14/2005 4:29:23 PM
From: Amy J	Read Replies (1) \| Respond to of 77400

Good post. VCs shouldn't be micromanaging startups by enforcing blind mandates a CEO follows purely to get his or her annual bonus rather than building shareholder value. The VCs should simply "ask, think, and hold them to their #s." The reasons for offshoring need to be founded on solid reasons, not the bonus of a ceo. And yes, it would be extremely naive for people to think "herd mentality" doesn't create a long-term trend, whether that trend is effective or not becomes mute if a policy is a blind mandate. This part is for Elroy, RE: "The VCs will go with whatever works. I find it hard to believe you don't think the US economy will figure out the superior process. Capitalism will cause the superior model to prevail." You give VCs much, much too much credit. The flaw with capitalism is this: capitalism responds to problems after they've been created. You are a hero if you solve a crisis, not if you prevent one. Regards, Amy J