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Why take vc money you don't need?
by keypusher 5y ago
Why take vc money you don't need?
- deleted 5y ago[deleted]
- ISL 5y agoTo have a war chest/insurance in case you need it.
- michaelchisari 5y agoThere are plenty of other ways to build a war chest. VC money is the easiest but it comes with the most strings.
- gunapologist99 5y ago.. what other ways? serious question.
- airstrike 5y agoSaving from Cash Flow from Operations? Assuming you're profitable, obviously.
- gen220 5y agoThere’s a number of reasons. It helps with hiring as a signal effect; if sequoia thinks the company you’re thinking joining is a worthwhile investment of they’re capital, they’re more likely a worthwhile investment of your career. The spare capital is good insurance against risks that might make fundraising in the future difficult. For example, needing to invest in PR/marketing, because an entrenched company with more resources released a competing product. Or legal fees, if you get sued for one thing or another. It’s also genuinely useful to have experienced investors on your board or in your intimate network, to ask for fiduciary-bound advice when waging your own battles. You typically “pay” for this service by raising money. I think this one is generally underrated by people who view the VC relationship as strictly transactional. Running a high visibility young company is incredibly stressful and it’s valuable to have people at the table who have seen it before. I imagine this last reason is probably the main one for WhatsApp’s choice.