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Curious. How do you see the system actually working - how do you stop at a billion? So, let's say you start a company. Then raise some VC money. You start gett
by terryf 4y ago
Curious. How do you see the system actually working - how do you stop at a billion?
So, let's say you start a company. Then raise some VC money. You start getting users and things are going really well, but you aren't quite profitable. You see a path to that but need to make investments to get there. So you raise another round of money. However, as you are doing well, the valuation of the company is set to three billion. As the founder, you still own 50% of the shares.
You are technically now a billionaire. Of course, just on paper but Forbes will still put you on the "overnight billionaire" list.
What are you supposed to do in this case ? When exactly did you go from "not psychopath" to "psychopath"?
- igorkraw 4y agoOn the system level:tax the billionaire? 1. Found a unicorn. Congratulations! 2. Get a tax bill 3. Either loan against your shares (good luck) or(and probably even if you do get a loan) 4. Go public early, selling your shares and let others partake in the companies growth Alternatively, give your shares to employees, donate, whatever. It's not really rocket science, just tax wealth (radical markets proposes a nice way to get honest self assessments...) and as a side benefit, you benefit employees by creating much more incentive against staying private forever
- terryf 4y agoSo you should be forced to IPO when a company valuation is 1b? Okay, fine. So if you IPO at 1b ( probably the valuation will drop after ipoing early but ok ) you are not considered a "psychopath" ? I'm sure all the employees with stock options will be thrilled as well after they drop in value.