3 ms·

Poking around, I found http://www.jobloft.com/blog/2006/11/22/jobloftcom-the-suns-still-shining-outside-the-den/ http://www.jobloft.com/blog/2006/11/22/jobloft

by palish 19y ago

Poking around, I found http://www.jobloft.com/blog/2006/11/22/jobloftcom-the-suns-still-shining-outside-the-den/ http://www.jobloft.com/blog/2006/11/22/jobloftcom-the-suns-s... .. It's Jobloft's side of the story. Apparently the dragons wanted to invest $200,000 for 50% of the company. I have no idea if that's a good deal or not.

nickb 19y ago
You have no idea? Hmm.... you need to think it through. Just think about how much exactly $200K would last them and how much more money they'd need to raise to become profitable. Not to mention the control problems. As funny as that whole thing was, the prof was right to break that deal. This company wouldn't have gone anywhere anyway with that kind of a structure.
- palish 19y ago
  That's right. I have no idea. You know why I have no idea? Because nobody is offering me $200k, that's why I have no idea. If they were, I'd immediately learn enough to make a relatively informed decision. But until then, I'd rather learn things that would help me build a product, not manage a company. So therefore, I have no idea. Gosh, what a horrible thing to admit.
pg 19y ago
Structurally that is almost guaranteed to be a bad deal. I doubt you'd ever find a deal of this form in the history of a startup that went on to be successful. If an investor buys as much as half the company (it does happen in some series A rounds), the valuation should be higher. Investors might pay $200k for half a restaurant or some other business like that, but not a startup.
- electric 19y ago
  Yes I think the professor realised this -- he was one of the founders of lavalife IIRC. I have seen the show and my observation was: The dragons are really mostly into funding sauce-makers, innovative clothing accessories, etc. and they apply the same principles to startups -- doesn't work well.
vikram 19y ago
I've always felt that they behave like VCs i.e. want a lot of control (hence the 50%) but only want to invest money like an angel. The weird thing is that given the amount of money they invest and the number of deals they do, they possibly can't have the time to run any of those early stage companies. I've never seen a startup accept funding from them, its either an inventor who gets access to a particular store or a mom & pop shop.
cstejerean 19y ago
Now that makes a difference. I didn't like at all the way the professor behaved but I liked the fact the guys from jobloft stuck by their gut feeling.
cyggie 19y ago
The first 2 parts of the show http://www.youtube.com/watch?v=Z9EkablfWVk http://www.youtube.com/watch?v=Z9EkablfWVk - Part 1 http://www.youtube.com/watch?v=lj8MNEgiDTU http://www.youtube.com/watch?v=lj8MNEgiDTU - Part 2 They tried to counter at 30% but decided to take the $200k / 50%

by palish 19y ago

nickb 19y ago

You have no idea? Hmm.... you need to think it through. Just think about how much exactly $200K would last them and how much more money they'd need to raise to become profitable. Not to mention the control problems. As funny as that whole thing was, the prof was right to break that deal. This company wouldn't have gone anywhere anyway with that kind of a structure.

palish 19y ago
That's right. I have no idea. You know why I have no idea? Because nobody is offering me $200k, that's why I have no idea. If they were, I'd immediately learn enough to make a relatively informed decision. But until then, I'd rather learn things that would help me build a product, not manage a company. So therefore, I have no idea. Gosh, what a horrible thing to admit.

pg 19y ago

Structurally that is almost guaranteed to be a bad deal. I doubt you'd ever find a deal of this form in the history of a startup that went on to be successful. If an investor buys as much as half the company (it does happen in some series A rounds), the valuation should be higher. Investors might pay $200k for half a restaurant or some other business like that, but not a startup.

electric 19y ago
Yes I think the professor realised this -- he was one of the founders of lavalife IIRC. I have seen the show and my observation was: The dragons are really mostly into funding sauce-makers, innovative clothing accessories, etc. and they apply the same principles to startups -- doesn't work well.

vikram 19y ago

I've always felt that they behave like VCs i.e. want a lot of control (hence the 50%) but only want to invest money like an angel. The weird thing is that given the amount of money they invest and the number of deals they do, they possibly can't have the time to run any of those early stage companies. I've never seen a startup accept funding from them, its either an inventor who gets access to a particular store or a mom & pop shop.

cstejerean 19y ago

Now that makes a difference. I didn't like at all the way the professor behaved but I liked the fact the guys from jobloft stuck by their gut feeling.

cyggie 19y ago

The first 2 parts of the show http://www.youtube.com/watch?v=Z9EkablfWVk http://www.youtube.com/watch?v=Z9EkablfWVk - Part 1 http://www.youtube.com/watch?v=lj8MNEgiDTU http://www.youtube.com/watch?v=lj8MNEgiDTU - Part 2 They tried to counter at 30% but decided to take the $200k / 50%