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How exactly do VCs win when the company crowd-raises $6m? Seems to me they make exactly $0 and receive 0% of equity, because they are not involved at all.
by DenisM 12y ago
How exactly do VCs win when the company crowd-raises $6m? Seems to me they make exactly $0 and receive 0% of equity, because they are not involved at all.
- themartorana 12y agoExcept there are already VCs in the equation, so any profitability helps them. It also doesn't dilute their shares, and they don't have to decide if they should risk doubling down on the second round. If I were a VC, this would definitely help validate my investment while requiring a total input of about zero from me. What business gets all the cash up front!!?
- jusben1369 12y agoAll VC's (at this stage of a company's life) want to see sales before they'll invest. These are the sales. I think Pebble wants a heck of a lot more money than $6m to compete with AppleWatch.