3 ms·
As a rule, technology startups don't distribute profits till they approach senescence and investors no longer trust them to invest their profits in their own ex
by pg 16y ago
As a rule, technology startups don't distribute profits till they approach senescence and investors no longer trust them to invest their profits in their own expansion. E.g. Microsoft, which was founded in 1975, didn't pay dividends till 2003.
YC companies usually hire accountants when they raise enough money to. Before that the founders keep track of finances themselves using Quickbooks (or a shoebox full of receipts).
- cmer 16y agoI personally found that doing my own accounting was a terrible waste of my time. I hired an extremely competent person for $20-25/hour (in Canada). Time was my most valuable asset as a founder, so I think outsourcing such a non-critical part of the business for so little money makes total sense. EDIT: $25/hour was for day-to-day accounting. Year end taxes were obviously more expensive (~$500). The company was a Delaware C Corp.
- j_baker 16y agoThis is going to sound dumb, but why do you use the word senescence here rather than maturity? They both seem to mean the same thing. Does it have some specific business meaning, or is it just another way of saying the same thing?
- mkramlich 16y agoguess: biological meaning, not psychological. saying X has reached maturity means they were immature before. calling something/someone immature has an insulting quality to it. the other does not.
- apu 16y agoHmm, I was under the impression that senescence is a little bit degrading (= getting senile), but perhaps not...
- pg 16y agoSenescence implies decay.
- j_baker 16y agoI see. So a difference in connotation.