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You're trying to think rationally against an irrational situation :O
by chrisabrams 9y ago
You're trying to think rationally against an irrational situation :O
- logicallee 9y agoSomething was going through their head. For comparison, how many people who are poor enter terms to buy hundreds of millions of dollars of property without having any mortgage or ability to pay or any expectation other than "wheeeeee - that was fun." I'd wager approximately zero. There is more to the above story. As described, these VC's wasted tons of their own time. How did they even have offices?
- EGreg 9y agoI toured some apartments without the ability to afford them. Perhaps these VCs were expecting money to come in but in the end their fund fell apart?
- logicallee 9y agoTouring is very different from signing! OP said "had no money raised but signed $11.5MM in investments with startups". maybe they mispoke.
- charlesdm 9y agoThere are ways to acquire assets without putting any money down yourself, so definitely possible, though not very easy. An example: say you acquire a company worth $10m and have no money in the bank. You could pay 50% of it in stock ("you'll be part of an amazing growth story, and the $5m stock you get today will be worth $50m in 5 to 10 years") and then go borrow $5m from a bank (or go through an equity investor) to fund the other 50% of the acquisition price. But often you'll need a binding LoI to get a loan. Doesn't always work, but if you're someone who is well connected then it's quite doable. I've seen it done. Another person that comes to mind is David Baazov: https://www.forbes.com/sites/nathanvardi/2014/12/01/the-king-of-online-gambling-is-34/#3c34859d396f https://www.forbes.com/sites/nathanvardi/2014/12/01/the-king.... He aligned things well and put deals together, and ended up making a ton of money because of it.