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There’s a ton of companies which exists solely to burn other peoples cash. I think VC funding makes IPOs a bit more confusing. It makes sense to IPO, if you ne
by mrweasel 5y ago
There’s a ton of companies which exists solely to burn other peoples cash.
I think VC funding makes IPOs a bit more confusing. It makes sense to IPO, if you need to money to boost your business. Duolingo needs money to update their app, so they can use the IPO to fund it.
The problem is that if you’re VC funded it now looks like the VCs have lost faith in the company. They paid for the bill for ten years and now they won’t help push the company into profitability? That makes an IPO look like an exist strategy.
- shapefrog 5y ago> That makes an IPO look like an exit strategy. Every IPO is an exit strategy or a refusal to run a balanced budget. If you have cash flow you can invest for free and compound the growth internally. If you have responsible financial management you can tap the bond markets for basically free. VC's want a 10 bagger - they have had it and more - is Duolingo going to be valued at $65B in a couple of years? I doubt it.
- patentatt 5y agoI think it was a typo, but I agree that the IPO is their “exist” strategy as in the purpose of the companies existence is to IPO, lol.