3 ms·
I think we might more accurately say; the entire “business” of some investors is to get companies acquired. That's not the same motive as seen from inside the s
by nonrandomstring 4y ago
I think we might more accurately say; the entire “business” of some
investors is to get companies acquired. That's not the same motive
as seen from inside the startup. And indeed, it's only some
investors. I believe there are plenty who are in it for the long
game, or are far more strategic in terms of ROI.
- scarface74 4y agoOnce the startup takes investor funding, it’s irrelevant what those inside the startup want. That being said, we all go to work to exchange labor for money. It’s naive for employees to see working for any for profit company as anything more than just a financial transaction. Investors know that the chances of a startup to go public and then be profitable enough to have long term stock gains is infinitesimally small. Can you name one startup that has been really successful - ie throwing off crazy profits and margins since Facebook? Investors aren’t interested in “lifestyle businesses”.
- jdsully 4y ago> Once the startup takes investor funding, it’s irrelevant what those inside the startup want. It really depends on the ownership structure, and that will depend on leverage at the time of fundraising. YC companies are unlikely to give up control until Series B (but like all things your mileage may vary).
- nonrandomstring 4y agoI don't know what the contractual structure entails, but I thought this recent post from R Bronson [1] is an exemplar of strategic investment in "good cause" projects without a nose for short term ROI, planned acquisition or any 'controlling' investor behaviours. [1] https://news.ycombinator.com/item?id=31598978 https://news.ycombinator.com/item?id=31598978
- jdsully 4y agoIf you don’t have leverage when raising money the opportunities to lose control are endless.