6 ms·
Why would a Harvard student give up 50%+ of ownership for a mere $1000?
by amichail 16y ago
Why would a Harvard student give up 50%+ of ownership for a mere $1000?
- defen 16y ago$1000 of weed/beer in exchange for 50% of a worthless venture probably sounded ok at the time.
- apsurd 16y agoNo, that's still a stupid proposition. Most Harvard students are presumbly pretty damned well off in the first place. Also, now that we've seen Zuck after the fact, you can't deny he is reasonably intelligent. Seems like a completely non-standard move imo. Even though I surely could use the money I'm way too arrogant to give up 50% of something I'm working on. I think the entire planet knows how arrogant Zuck is (not necessarily a bad thing).
- defen 16y agoThere are plenty of students from well-off families - that doesn't mean that they personally have access to a lot of cash to spend on whatever they want. Regardless, I wasn't trying to give an actual accounting of Zuckerberg's thought process. It was more of an attempt at an easy joke about the proclivities of the average 19 year-old college student.
- kenjackson 16y agoIf I was 19 yo I'm not so sure I wouldn't give up 50% of a company for $1k. Remember, at age 19, you haven't actually created anything of value. This $1k seems like a free computer at the time. And in the off chance this company does well, 50% of $1B is $500M. I'm happy to just have my $500M. Or at least I would be at the time I'm hypothesizing about this company. Of course, Mark wouldn't take that deal now if he started a new company. But I bet you can still find a relatively bright student somewhere who would.
- tlrobinson 16y agoAlso, why didn't he resolve the situation by either starting a new company or buying back his shares as soon as it was apparent Facebook could become something big?
- mkramlich 16y agopossibly because he is/was young and naive
- tlrobinson 16y agoYes, but this is the sort of thing that should have come up during the due diligence of the very first round of funding.
- dedward 16y agoNo corporation or shares existed at the time the work for hire was done....
- zackattack 16y agoCan someone please clarify the ethical as well as legal ramifications of subverting investors by starting a new company? For example: You start company A, in market M. Your investors give you 5k in exchange for 50%. You spend your 5k learning about market M and now you're diluted. What's stopping you from creating company B, to attack same market, but from an enhanced perspective?
- michael_dorfman 16y agoIn many cases, there are contracts in place to prevent exactly that. When I cashed out of my first startup, I was legally prohibited for working in that domain for X years.