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A professional investor (or group of investors) providing a seed or Series A after a couple of years is realistically going to have little interest in cashing o
by 7Figures2Commas 13y ago
A professional investor (or group of investors) providing a seed or Series A after a couple of years is realistically going to have little interest in cashing out existing friends and family investors at a gain. At that stage, you're investing to grow a nascent business, not to buy the founder's mom and dad a deluxe new kitchen.
- 001sky 13y agoYes, this is right. An angel or early investor should not be <expecting> any capital return until a proper exit. Especially if that "return" is coming from incremental capital being raised by the startup. Later in the game, when the business is de-risked and there is more demand for the company than shares to be sold, things may be different. This is why you see late-stage mezzainine investments that might take out early investors before an IPO. That is merely because those guys are momentum players, and the original investors' work in taking the actual risk of the business has been already done.
- wdewind 13y agoReally? Who is going to raise a down round for your seed/series A? And if you're raising an up round, why does it matter if the shares come from you or f&f? Honest questions.