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In many cases a round of this size is like a 'private IPO' and provides some liquidity for founders or even early employees. This quote suggest that may be the
by jim-greer 15y ago
In many cases a round of this size is like a 'private IPO' and provides some liquidity for founders or even early employees. This quote suggest that may be the case here:
<quote>The new funding “is like an IPO without the headaches,” he said, adding that the start-up can now “stay private for quite some time.”</quote>
- joering2 15y agoSomeone may need to correct me here, but why would there be a pressure to go IPO? plenty of companies stay out of public market (in private hands), remain strong, build brand, bring profits, etc. IF they havent brought strong numbers already, what would make anyone sure another $85 mil will?
- patio11 15y agoThere is strong pressure to IPO because that is a liquidity event (opportunity to turn ownership into money) for investors. The other option is acquisition. Recently, IPOs are hard, for a combination of regulatory and market reasons. One could imagine a hypothetical world where profits paid as dividends to owners would suffice to give investors the return their business model requires but that is very much not standard practice in the US tech industry. To a professional investor (especially a VC firm), a profitable company that cannot be sold/IPOed is a failure.