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> "I’m reaching out to share some great news" This is disgusting. Remember that this letter is: 1. for common shareholders who will get absolutely nothing out

> "I’m reaching out to share some great news" This is disgusting. Remember that this letter is: 1. for common shareholders who will get absolutely nothing out of this deal. 2. yet it's asking them to sign so that they can go ahead with the deal. 3. And to top it off, "I'm reaching out to share some great news"? Are you kidding me? To be clear, I support all entrepreneurs regardless of what ridiculous business model they're trying to pull off. I even think Magic Leap should be given a benefit of the doubt and they may be able to pull it off. Also I think it's great that silicon valley celebrates failure. Without this type of environment it's hard for founders to shoot for the stars. That said, people have taken this too far, and it's become ridiculous. It's no longer about it being ok to fail, but it's about "I failed, so what? I'm the genius and I totally deserve it and you just paid to tag along." I totally despise bullshit like this. If you lost, just say you lost. And say sorry. Don't bullshit people about how "it's a great news that I'm asking you to sign this letter so that other people--not you--will get the money you actually deserve".

Pyxl101 9y ago
Indeed. What is the incentive for any common stockholder to sign what they will be asked to sign? I could imagine someone holding back purely out of spite. Though I suppose, perhaps, if those common stockholders are employees who want to keep their jobs rather than be laid off, that might be one reason, though an individual wouldn't learn whether they'll be retained until a later stage of the acquisition.
- confiscate 9y ago
  Agree. If the goal of the letter is to get signatures, starting off with "great news" and then leading to "you get $0" does not seem to be the most convincing nor effective way to phrase a signature request. Well, if the reader is an employee holding Common stock, and the employee signs just to keep her job, then she would have signed regardless of what the letter said anyways. Basically, it's hard for me to see a Common stock holder reading the letter, and then going "Ya that makes sense, I'd buy this. Let me sign it now."
colbyh 9y ago
This was an internal email to investors. You have no idea what convos she's had with them previously about the situation but you're very quick to assume she's some self-important Jobsian figure. Be human, chill on the assumptions. Startups are hard and you don't have all the data so Danielle deserves the benefit of the doubt, not some vaguely related ranting about responses to failure.
- cocktailpeanuts 9y ago
  I normally never criticize founders when startups go down because I have been there too and understand how hard it is for the founders first hand. But please enlighten me. What kind of conversations could have possibly happened before this letter that could justify saying something like "You invested money (or time) and we've just lost all of it. You will be getting $0. But I need you to sign this so that other people CAN get some money. Oh by the way, it's a great news!" Most common stock holders are probably former employees (whereas preferred stock holders are VCs). At this point I'm sure they didn't expect much out of this anyway, but they were once people who truly believed in the vision. If I were one of those people I wouldn't be happy to hear this fake facade about how this is a "great news". Phrases like this you should only use it for PR you send to Techcrunch, saying you had an incredible journey. But not to former employees who made a lot of sacrifices. To those people you be honest.
  - gumballhead 9y ago
    Probably money and time. If they are common shareholders they likely had to pay out of their own pocket to exercise their options and also had to pay taxes on it. Not great news at all.
  - crdb 9y ago
    > But please enlighten me. What kind of conversations could have possibly happened before this letter that could justify saying something like "You invested money (or time) and we've just lost all of it. You will be getting $0. But I need you to sign this so that other people CAN get some money. Oh by the way, it's a great news!" This reminds me of when my father's employer went out in the wake of the 1999 bubble popping. A couple of years later, the CEO sent him a very nice email saying "hey, mind signing over your stock please" and he was about to do it. I thought it was fishy that the ex-CEO want something worthless back, so I called my uncle who invests in SMEs on the side of his job and he agreed that we should ask for something back in return. So we asked, and got, a few thousand for his stock, without a whisper of complaint from the ex-CEO (guess we asked for too little).
ggg9990 9y ago
I agree. I lost about 60 cents on my investors' dollar and I called up every single one of them (including syndicated angels) and told them basically "I have some difficult news for you. Our company is failing and the best option is to sell to BigCo for 40 cents on the dollar. Thank you for investing in me and sorry I couldn't get you a better outcome. Please sign the acquisition agreement."

Pyxl101 9y ago

Indeed. What is the incentive for any common stockholder to sign what they will be asked to sign? I could imagine someone holding back purely out of spite. Though I suppose, perhaps, if those common stockholders are employees who want to keep their jobs rather than be laid off, that might be one reason, though an individual wouldn't learn whether they'll be retained until a later stage of the acquisition.

confiscate 9y ago
Agree. If the goal of the letter is to get signatures, starting off with "great news" and then leading to "you get $0" does not seem to be the most convincing nor effective way to phrase a signature request. Well, if the reader is an employee holding Common stock, and the employee signs just to keep her job, then she would have signed regardless of what the letter said anyways. Basically, it's hard for me to see a Common stock holder reading the letter, and then going "Ya that makes sense, I'd buy this. Let me sign it now."

colbyh 9y ago

This was an internal email to investors. You have no idea what convos she's had with them previously about the situation but you're very quick to assume she's some self-important Jobsian figure. Be human, chill on the assumptions. Startups are hard and you don't have all the data so Danielle deserves the benefit of the doubt, not some vaguely related ranting about responses to failure.

cocktailpeanuts 9y ago
I normally never criticize founders when startups go down because I have been there too and understand how hard it is for the founders first hand. But please enlighten me. What kind of conversations could have possibly happened before this letter that could justify saying something like "You invested money (or time) and we've just lost all of it. You will be getting $0. But I need you to sign this so that other people CAN get some money. Oh by the way, it's a great news!" Most common stock holders are probably former employees (whereas preferred stock holders are VCs). At this point I'm sure they didn't expect much out of this anyway, but they were once people who truly believed in the vision. If I were one of those people I wouldn't be happy to hear this fake facade about how this is a "great news". Phrases like this you should only use it for PR you send to Techcrunch, saying you had an incredible journey. But not to former employees who made a lot of sacrifices. To those people you be honest.
- gumballhead 9y ago
  Probably money and time. If they are common shareholders they likely had to pay out of their own pocket to exercise their options and also had to pay taxes on it. Not great news at all.
- crdb 9y ago
  > But please enlighten me. What kind of conversations could have possibly happened before this letter that could justify saying something like "You invested money (or time) and we've just lost all of it. You will be getting $0. But I need you to sign this so that other people CAN get some money. Oh by the way, it's a great news!" This reminds me of when my father's employer went out in the wake of the 1999 bubble popping. A couple of years later, the CEO sent him a very nice email saying "hey, mind signing over your stock please" and he was about to do it. I thought it was fishy that the ex-CEO want something worthless back, so I called my uncle who invests in SMEs on the side of his job and he agreed that we should ask for something back in return. So we asked, and got, a few thousand for his stock, without a whisper of complaint from the ex-CEO (guess we asked for too little).

ggg9990 9y ago

I agree. I lost about 60 cents on my investors' dollar and I called up every single one of them (including syndicated angels) and told them basically "I have some difficult news for you. Our company is failing and the best option is to sell to BigCo for 40 cents on the dollar. Thank you for investing in me and sorry I couldn't get you a better outcome. Please sign the acquisition agreement."