4 ms·

A business that has an inherent call option, that could boost its base-line exit value by at least 10x I will go ahead and expose my novice status and ask: wha

• nickb 18y ago
  It's just a financial vernacular. Call option is a type of a contract that gives the buyer an 'option' to buy the underlying instrument (a derivative or a stock in this case) at a later date at a specified value. Simply put: the buyer will profit if the value of the company increases. So all he's is saying that he is looking to invest into a business that will rise in value over time and that will be sold to a third party – "an inherent" part – and he also means that he's not looking to invest in "lifestyle"/"we'll pay out dividend"/"37sig" type businesses. And the last sentence fragment is self explanatory: he expects the value of the company to increase the value over time by at least 10x so he makes back roughly 10x on his investment (roughly since it doesn't really work out like that with IRR).
  • netcan 18y ago
    I thought it meant mean that in the event of success, he can increase his investment.