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Always a puzzle - if they were profitable (as they say), why did they need capital on these terms?
by hmahncke 8y ago
Always a puzzle - if they were profitable (as they say), why did they need capital on these terms?
- abenedic 8y agoPossibly they had funding from early investors on very bad terms. I have worked at a startup that ran into issues with early investors expecting a return before the product launched. Depending on how the terms were negotiated it could be just a bad deal.
- rahimnathwani 8y agoTwo reasons: - profit != cash flow - 2016 profitable != 2018 profitable
- nikanj 8y agoI think the key question in parent comment was "on these terms". Getting financing for a profitable, growing business should not be this painful.
- rahimnathwani 8y agoYes, but just because they were profitable at some moment back in 2016, that doesn't mean that they're profitable today.
- hmahncke 8y agoThat's probably right.