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I suspect the terms of their funding and human nature have something to do with it. If the business shuts down everyone (founders and investors) loses. If the
by andyjdavis 13y ago
I suspect the terms of their funding and human nature have something to do with it.
If the business shuts down everyone (founders and investors) loses.
If they now run it as a lifestyle business the founders win but the investors lose.
If I was an investor in that second case I would be deeply suspicious and possibly angry.
- cheapsteak 13y agoCould you elaborate on how the investors would lose if they run it as a lifestyle business? Would they make more money back by liquidating their assets?
- cgag 13y agoI think they "lose" in that they'll be angry to see someone still making a living on the idea while they saw no returns. Or maybe they can't break free, and keeping it running would still mean just giving the profits to the investors for the next 100 years and it's easier to just close it all together?
- dkersten 13y agoEven making a 2x or 3x return is a failure for a VC and not seen as worth their time.