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Founders are not second class. They generally hold way more of the company than their investors unless the company has had a down round, raised a series B/C, or
by 3pt14159 12y ago
Founders are not second class. They generally hold way more of the company than their investors unless the company has had a down round, raised a series B/C, or went public - and in either case the founders have a disproportionate amount of control and ownership compared to the opportunity cost.
- RestlessMind 12y agoDoes that still mean rest of the folks (after founders and investors) are third class?
- michaelochurch 12y agoThey're second-class, except for celebrity founders who call themselves "serial entrepreneurs" and can regard fundraising as an afterthought. Having 60% of one startup, and having to do all the work, is inferior to having 20% of ten startups, and having power but no responsibility to any single one of them. Founders have more power within their specific companies (if things are going well) but investors have the power that matters, because they're diversified and involved in a large number of things.
- 3pt14159 12y agoA partner at a VC will generally only vouch for one or two startups a year. They are responsible for allocating capital, not directing employees. Furthermore, the partner at a VC will generally not have anywhere close to 20% of ten startups (usually it's 15% to the fund). They have a draw off of the fund (which they have to raise) and they have a certain amount profit if the fund is successful. I do agree with you that engineers (especially the first 4 hires) generally get the worst deal of all.