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Investors (and the team) were looking at the wrong numbers. In apps, it's basically all down to having meteoric growth week over week. It can't be based on spik
by SandersAK 11y ago
Investors (and the team) were looking at the wrong numbers. In apps, it's basically all down to having meteoric growth week over week. It can't be based on spikes as this was.
Taking money off the table in a B makes sense for the founders, and I can't blame them for leveraging their situation.
Ultimately this falls on the investors for biting on hype, and not having a deeper understanding of the product (and it's potential)or the founders (and their potential).
edited for clarity.
- sharkweek 11y agoTotally makes sense - but I also completely get why the investors would bite on hype - missing the next billion dollar company is way worse than incorrectly picking a few duds.
- untog 11y agoA $35m dud, though. That's not small fry.
- erichmond 11y agoExactly right, this is a very important message here that should be taken away by future (and current) entrepreneurs.
- josu 11y agoI don't know, at a 130m valuation, a 100x exit was no longer possible, and even a 10x didn't even seem that likely.
- benologist 11y ago130m x 100 is only 1/4th of uber, not really impossible anymore.
- outericky 11y agoUber hasn't exited, so that argument has no basis. Can maybe compare to whatsapp... and that's probably what investors did.
- deleted 11y ago[deleted]
- mathattack 11y agoIt's high risk for the investors. For every Uber, there are many that don't pan out. It's the nature of the game, and why they make lots of investments.