3 ms·
This is something you can believe only if you think the vast majority of startups are making these returns. The fact is the lions share of risk also goes to VCs
by matte_black 9y ago
This is something you can believe only if you think the vast majority of startups are making these returns. The fact is the lions share of risk also goes to VCs.
If you gave an average investor the kind of deal flow that big name VCs have access to you’d fry their central nervous system.
YC, for all it’s prestige, has only had one startup actually IPO, and only recently. Can an average investor survive this kind of torture? Never knowing if maybe one day all the money they put down will actually net some return? Knowing that they will have to continue investing or else hang all their hope on what they’ve invested in so far?
There’s plenty of sure money to be made buying post IPO, be content with that.
- maxxxxx 9y agoAn IPO is not the only way for VCs to make money. When a company raises money there is often a chance for the earlier investors to sell their shares to new investors. At the time time of the IPO they have already made a lot of money.
- mistermann 9y ago> YC, for all it’s prestige, has only had one startup actually IPO, and only recently. That may be perfectly consistent with my point - VC's typically provide multiple large rounds of financing, something that formerly would have required going to the public markets, and this can delay IPO's until companies are heavyweights and most of the big gains are in the bag.
- nathan_f77 9y agoThere's only been one IPO, but there's been ~83 exits: http://yclist.com http://yclist.com (Only select the "Show Exited" checkbox.)