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In a world where you could get a VC to sign any deal, sure, but realistically any VC investing on a large enough scale will require provisions for a trigger the
by newhouseb 12y ago
In a world where you could get a VC to sign any deal, sure, but realistically any VC investing on a large enough scale will require provisions for a trigger they can pull to get their money back out if their investment survives long enough without liquidity. I'm sure someone can provide more detail but if I recall correctly they tend to be about 10 years out and require that the companies go public or allow the VCs to sell there shares (possibly back to the company) at some certain value.
- Retric 12y agoProfitable company's can just get a loan to buy those shares based on a reasonable valuation of the companies value. IPO's are only nessisarily if you need to rase money or are overvalued. Bonds, private equity, institional investors, and plenty of other options exist when you don't need a greater fool.
- 001sky 12y agoDebt for equity swaps are only of use up to a point. The issue is the ration of one to the other. Which will be proportionate to cash flow and not to paid-in capital (or a multiple therof).