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A few thoughts on this: - VCs got beat up on this deal. Sounds like he just handed them a term sheet and said take it or leave it. I don't know how you raise $
by inthewoods 12y ago
A few thoughts on this:
- VCs got beat up on this deal. Sounds like he just handed them a term sheet and said take it or leave it. I don't know how you raise $200m and still control 27.3% as a founder and 68.3% as a company. That is great negotiating on his part - very, very impressive.
- Only raising $100m in the public markets is smart as well - small float will mean more chance for the stock to do well (not always obviously).
- Employees (below the Director/VP level) seem likely to be the odd man out here - you've got those guys owning 68.3%, VCs probably own most of the rest. Rank and file likely own very, very little. I'm wondering if that will lead to an exodus of employees.
- I didn't see any mention of their churn rate in any of the documentation - did I just miss it?
Lew and these guys have played the VC/public markets game about as perfectly as you can imho.
- nemo44x 12y agoThey will likely raise much more than 100 million. That is the "default" setting for the S1. Also, if the IPO goes well expect the underwrite to green shoe some more.
- aacc1313 12y agoNote - the 68.3% includes the key VCs, who are executive directors. The balance is divided up among the other investors and the employees. If you think about it, the founding group/top management team can hope to retain ~30% if they have solid up rounds. Lew, I think, is the sole founder and has a chunk of that 30%. Very impressive indeed, especially given the large fund raise to date.