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So many of these investment amounts were exceeded by the payments the company agreed to make back to Palantir. Giving up equity for an "investment" that basical
by rurp 4y ago
So many of these investment amounts were exceeded by the payments the company agreed to make back to Palantir. Giving up equity for an "investment" that basicaly equals a free trial of some Palantir software seems like a terrible deal for the company. Is there a valid reason for this aside from the obvious ones of corruption and incompetence?
- cutemonster 4y agoSuch a company still would have some extra millions, for some years, after the initial pay-back. Which maybe could look like a good deal, if your company was struggling ...
- panda888888 4y agoI'm not sure if these are "valid reasons" but here's my guess: Palantir is a professional services company with a handful of large customers, such as the US Government. It seems like they're trying to pivot away from consulting and into being a true software company with a large number of small customers as opposed to a small number of big clients. If their goal is to reach some benchmark number of customers, buying customers would make sense, just like how brands pay for followers on Instagram. Same goes for if they need to figure out how to serve these customers; offering free service to the first X customers is common. At a certain point, the marginal cost of software is near zero, so if they are only offering the software and not consulting, giving out extra licenses doesn't cost them anything. And if they get bites, they can always up-sell these clients on their consulting services.
- rchaud 4y agoEverything about Palantir suggests they would be happy to become a software equivalent of Raytheon, exclusively servicing state/military customers with contracts that never expire.