3 ms·
Simple n00b question about funding
Lets say I start a startup on my own. Some VC comes along and decides to fund my company 10 million for 40% equity.
Do I personally get to keep any of that 10 million? If the startup fails do I owe him his 10 mil back? Can I pay myself a huge salary?
( i know this is a bad attitude to have, and i'm just using this as an example to illustrate my question. Trying to learn more about the process )
- pg 19y agoNo, no, and no.
- mikesabat 19y agoNo, absolutely not. VCs aren't stupid and you sign a contract with them. If you were a VC would you leave that door open? http://www.venturehacks.com http://www.venturehacks.com - read this blog.
- utnick 19y agoyea i kinda figured that but its hard to figure what some of these web 2.0 companies are doing with millions of funding if not paying the founders big 6 figures
- aston 19y agoI think you could swing paying yourself 6 figures with an investment of $10 million assuming you were one of only a few employees.
- nostrademons 19y agoHiring 10-20 people and holding enough cash in the bank that it'll last them for 2 years or so.
- wlievens 19y agoEmploying people is very, very expensive. If you run a company with more than say 3 people, you're also going to be needing an office. And computers.