4 ms·

Important tip for people considering startups: only join ones that recently raised an A or B round from one of the top VC firms. VCs get to see all of the numbe

by m_ke 5y ago

Important tip for people considering startups: only join ones that recently raised an A or B round from one of the top VC firms. VCs get to see all of the numbers and won't invest unless there's some sign of upside.

kyawzazaw 5y ago
Is round C or D too late?
- m_ke 5y ago
  All of the rounds have shifted a bunch lately and companies are going public sooner than they used to. What I really meant was that you should join companies that are on a clear path to have a major exit within the next 2-3 years.
  - rsanek 5y ago
    What companies are exiting within 2-3 years of raising a Series A, B, or even C? Strongly disagree that companies are going public sooner, if you compare when eg msft / goog went public vs airbnb / uber the market cap is radically larger and the companies are much older.
    - m_ke 5y ago
      Seed rounds got larger and moved down a bit with a rise in "pre-seed" rounds. Thanks partially to SPACs and direct listing we've had a boom in IPOs the past two years. (https://www.wraltechwire.com/2021/10/01/biggest-ipo-boom-in-decades-gives-huge-boost-to-wall-street/ https://www.wraltechwire.com/2021/10/01/biggest-ipo-boom-in-...) Before 2018-2019 the common wisdom was to stay private as long as possible because Softbank and other late stage firms were willing to throw a lot of money around in private rounds. Now VCs are trying to throw their companies over the fence as soon as possible.
smilekzs 5y ago
Yeah but after each "validation round", the stock option grant for new hires becomes 0.1x before the validation. Kinda sucks to join right after Series A, get a tiny % (say less than 0.1%) of the company even after 4 years of grinding away, and even then the company doesn't go public so your options are still worth a tiny % of... zero. Right now it only kinda makes sense when you join as a co-founder (at most seed round; definitely not post-series-A), or pre-IPO.

by m_ke 5y ago

kyawzazaw 5y ago

Is round C or D too late?

m_ke 5y ago
All of the rounds have shifted a bunch lately and companies are going public sooner than they used to. What I really meant was that you should join companies that are on a clear path to have a major exit within the next 2-3 years.
- rsanek 5y ago
  What companies are exiting within 2-3 years of raising a Series A, B, or even C? Strongly disagree that companies are going public sooner, if you compare when eg msft / goog went public vs airbnb / uber the market cap is radically larger and the companies are much older.
  - m_ke 5y ago
    Seed rounds got larger and moved down a bit with a rise in "pre-seed" rounds. Thanks partially to SPACs and direct listing we've had a boom in IPOs the past two years. (https://www.wraltechwire.com/2021/10/01/biggest-ipo-boom-in-decades-gives-huge-boost-to-wall-street/ https://www.wraltechwire.com/2021/10/01/biggest-ipo-boom-in-...) Before 2018-2019 the common wisdom was to stay private as long as possible because Softbank and other late stage firms were willing to throw a lot of money around in private rounds. Now VCs are trying to throw their companies over the fence as soon as possible.

smilekzs 5y ago

Yeah but after each "validation round", the stock option grant for new hires becomes 0.1x before the validation. Kinda sucks to join right after Series A, get a tiny % (say less than 0.1%) of the company even after 4 years of grinding away, and even then the company doesn't go public so your options are still worth a tiny % of... zero. Right now it only kinda makes sense when you join as a co-founder (at most seed round; definitely not post-series-A), or pre-IPO.