101–110 of 170 posts
It sounds like Bootup Labs wasn't able to draw down on some of their LPs. So, it's not nefarious, but it would make me think twice before accepting (the promise of) money from Bootup Labs. It ain't real 'till the money's in the bank.
Danny, one of the bootuplabs founders just posted this comment on the post. ///////////// This is not how it went down Jamie. After everything that we did for you and Steven, I'm shocked at how you have twisted the truth for PR reasons. - you were in our office for 2 months, not 3. - you program is 5%-15% for $150k over 8 months - you received $6k over that 2 months - we received nothing in return. - we paid your leg…
My response which I posted: Hey Danny. I apologize that you feel like I'm twisting the truth. It was the last week in January until the end of last Month. While we were there 3 months of the year, you are correct 2 months would be more accurate, I was just getting the $100k off of the Bootup website, I understood that we got $150k, but that $50k went back to Bootup, is that not what the original terms were? You did p…
Soory you guys have had ahard time, Hope this experience doesn't scare too many other people off doing startups in vancouver or coming here to start a business
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Wow, they're really clutching at straws. The legal fees were presumably spent setting up a Canadian corporation. What use is that to the founders now? Similarly, the rent being paid - the cost of throwing all your stuff out (and presumably having to buy it again later) will be for most people way higher than a few months worth of rent. It's often too easy to jump to the wrong conclusion... but I'm struggling to see a…
Correct me if I am reading too much into their response. But it sounds like they were at the tail end of closing a round of financing. The investors didn't like some of the startups in the current cohort so they made it a requirement that Bootup cut them from the program before the new round closed. So instead of honoring their word they choose to take the money. Very poor business practice IMO.
This has been written about on RWW now: How to Burn Bridges with Bootup Labs and Other Investors http://www.readwriteweb.com/start/2010/04/how-to-burn-bridge...
Not exactly solid reporting :(
What a horror story. What sort of program offers $100k to that many groups and doesn't follow through? "Whoops, we were $500k short." That goes beyond just being embarrassing.
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> $50k/startup management fee What?!
Bootup Labs is structured as an investment plus a services contract. They give you $50k in exchange for 5% equity, then you immediately pay the $50k back to them in exchange for the office space, accounting services, legal services, mentoring, et cetera. Then they give you a $100k line of credit which converts (at their option) at 1% equity per $10k. It's a very effective way of protecting themselves from downside ri…
Earlier quoted context omitted.
Bootup Labs is structured as an investment plus a services contract. They give you $50k in exchange for 5% equity, then you immediately pay the $50k back to them in exchange for the office space, accounting services, legal services, mentoring, et cetera. Then they give you a $100k line of credit which converts (at their option) at 1% equity per $10k. It's a very effective way of protecting themselves from downside ri…
Incubators that ask you for money _and_ equity make me a little bit sick. Either sell me a service or give me cash for equity. Don't do both.
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As a manager of Bootup, I can assure you that we haven't been personally paid anything. My apologies. I had understood that you were drawing a salary from Bootup Labs based on a conversation I had with Boris a few months ago, but I can't remember exactly what he said, and it's quite possible that I misinterpreted him. Even if you're not personally getting paid anything, I think $50k is a rather generous fee given tha…
Other accelerators get the same fee as well. There are expenses to operate the accelerator plus an investment in the startup, which is exchanged for % in the startup. Often 5%-6%. If you add this up, effectively, the companies are getting $60k of real money spent on them for 6% of the company. That's a $1M post money value. (note: YC is probably an exception to this math since it has no physical space) But, that's ho…
This has been written about on RWW now: How to Burn Bridges with Bootup Labs and Other Investors http://www.readwriteweb.com/start/2010/04/how-to-burn-bridge...
That, uh, reads a lot like Dana saying: "haha nub, you won't ever get investors now will you!" Not exactly solid reporting :(
Earlier quoted context omitted.
Bootup Labs is structured as an investment plus a services contract. They give you $50k in exchange for 5% equity, then you immediately pay the $50k back to them in exchange for the office space, accounting services, legal services, mentoring, et cetera. Then they give you a $100k line of credit which converts (at their option) at 1% equity per $10k. It's a very effective way of protecting themselves from downside ri…
True VC firms would never invest in this structure for many reasons. Naive angels or silver-spooners, maybe.