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I'm curious. Does that mean that the angels don't expect to get a decent return if FB buys their investment?

by amirmc 16y ago

DanielRibeiro 16y ago
If I recall correctly, they feel like startups sell too early to Facebook, foregoing the oportunity to get bigger. Pg said this is good, because the founders are instantly removing all risk for what is alredy a lot of money. Investitors are not so thrilled, because they are not getting that much money, and would be willing to take the risk. However, founders don't have 100 companies they are investing, so the risks are not felt the same by founders and angels. Angel conf presentations say a lot more: http://justin.tv/ycombinator http://justin.tv/ycombinator
- staunch 16y ago
  I'm pretty sure YC wants their companies to IPO more than almost anyone else. YC is in the same boat as angel investors. The difference is that YC is sympathetic to founders when they want to cash out vs shoot for the stars.
  - DanielRibeiro 16y ago
    If it is not explicitely said, (too many essays/videos/interviews about the subject), this is certainly the tone on Hiring is Obsolete: http://www.paulgraham.com/hiring.html http://www.paulgraham.com/hiring.html Also, pg explicitely mentions founders not willing to take a safe exit now instead of an uncertain big exit in a possible future may not be such a good idea (http://paulgrahamsidebar.heroku.com/guidetoinvestors.html#gm_topic_6 http://paulgrahamsidebar.heroku.com/guidetoinvestors.html#gm...) But my question was not regarding YC, but more about angels.
- nl 16y ago
  I've got zero sympathy for investors in this situation. If you look at the numbers, most of those talent acquisitions end up making investors 2 or 3 times their money in 12-24 months. If investors don't like that return, then they should set their liquidation preference high enough to make whatever profit they want. Of course, founders would be free to ignore anyone who's money is too expensive, too....

I'm curious. Does that mean that the angels don't expect to get a decent return if FB buys their investment?

by amirmc 16y ago

I'm curious. Does that mean that the angels don't expect to get a decent return if FB buys their investment?

If I recall correctly, they feel like startups sell too early to Facebook, foregoing the oportunity to get bigger. Pg said this is good, because the founders are instantly removing all risk for what is alredy a lot of money. Investitors are not so thrilled, because they are not getting that much money, and would be willing to take the risk. However, founders don't have 100 companies they are investing, so the risks are not felt the same by founders and angels. Angel conf presentations say a lot more: http://justin.tv/ycombinator http://justin.tv/ycombinator

staunch 16y ago
I'm pretty sure YC wants their companies to IPO more than almost anyone else. YC is in the same boat as angel investors. The difference is that YC is sympathetic to founders when they want to cash out vs shoot for the stars.
- DanielRibeiro 16y ago
  If it is not explicitely said, (too many essays/videos/interviews about the subject), this is certainly the tone on Hiring is Obsolete: http://www.paulgraham.com/hiring.html http://www.paulgraham.com/hiring.html Also, pg explicitely mentions founders not willing to take a safe exit now instead of an uncertain big exit in a possible future may not be such a good idea (http://paulgrahamsidebar.heroku.com/guidetoinvestors.html#gm_topic_6 http://paulgrahamsidebar.heroku.com/guidetoinvestors.html#gm...) But my question was not regarding YC, but more about angels.
nl 16y ago
I've got zero sympathy for investors in this situation. If you look at the numbers, most of those talent acquisitions end up making investors 2 or 3 times their money in 12-24 months. If investors don't like that return, then they should set their liquidation preference high enough to make whatever profit they want. Of course, founders would be free to ignore anyone who's money is too expensive, too....