Interesting write up. However, I don't see the point of picking apart a small paragraph, which, IMHO, was meant to provide mere guidance and perspective.
All the other points made in this 'response' are all fairly obvious and again, IMHO, already being worked on.
I think PG was spot on with his guiding essay; many things stand out and serve as a guide for people formulating ideas for a start up. If I am going to seriously undertake the task of building a start up, and dedicating an important part of their life to building something, I'd take all the sound guidance I can get.
The market does not work in objective economic ways. The market prices different stocks because of various different factors - the weights of which are continuously changing. IMHO, this phenomenon is well explained by George Soros in his FT lectures from 2009:
http://www.ft.com/indepth/soros-lectures
Some good examples or this behavior:
- The run up in the overall market, and specifically in the Mortgage Backed Securities (MBS) and the eventual crash was not based on good economics and lasted for several years.
- MDBX (MedBox) recent run up and correction is also a good example (TechCrunch, of all things, brought this to my attention)
- The recent drop in DDD (3D Systems) after a negative Seeking Alpha article, is also an example of how the market doesn't always behave in objective economic ways.
Especially liked how this was put together: