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Yeah, I just meant to show what is probably a worst case (not really, worst case would be company goes under or loses a lot of value/market share I guess), wher
by kbenson 5y ago
Yeah, I just meant to show what is probably a worst case (not really, worst case would be company goes under or loses a lot of value/market share I guess), where they accept money and it's spent in an effort to help the business but just doesn't. I guess in the example you put forth that would be a $50 million company that takes $5 million, spends it on a major advertising campaign, and sees zero difference. Now they've given away equity and gotten nothing in return other than that what they tried before doesn't work. The flip side is that it helps immensely and your lower equity might be worth more overall. Any anything in between.
At least that's how I understand it. I'm not trying to pretend I know a huge amount about this. It's mostly general knowledge accumulated from normal sources and discussions here, so if you think I'm totally missing something, I'm happy to hear it.