6 ms·
So use tranches and don't invest in founders who are going to run away with your money? If you're afraid of losing $10M because you don't trust the founders to
by unlinked_dll 7y ago
So use tranches and don't invest in founders who are going to run away with your money? If you're afraid of losing $10M because you don't trust the founders to invest it in their business there are safer investments you can make.
- aplummer 7y agoBut what if they just keep raising money at crazy valuations because it's easy to get and hoard?
- wpietri 7y agoExactly. Or just skip the tranches and only give founders as much as they can reasonably spend proving that they deserve more money.
- sokoloff 7y agoAs an investor, you want the CEO working on the company, not spending all their time and focus raising incremental tiny rounds and being one raise away from complete failure at every step. As an employee, you want the exact same, only much more critically and personally.
- Apocryphon 7y agoHuge rounds lead to share dilution. The best thing to want is organic growth that preempts the need to raise rounds.