What can you buy for $100K? It's not worth thinking IMO. Keep your 5% and find a job if you need $100K cash.
43 bitcoins.
Ask HN: Ex-Founder. Should I take lowball buyout offer?
121–130 of 172 posts
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#122Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#123Earlier quoted context omitted.
It doesn't sound to me like they clearly want the OP to sell. It actually sounds like the opposite. The OP wants to get out, and they responded with a lowball offer which, if anything, would motivate the OP not to sell.
You are assuming all wrong. Start by offering a tenth of what you would agree to pay. All you risk is that they accept your offer. It's standard business practice. Works more often than not.
Why a tenth? Why not 1%?
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#124The bubble is coming to an end.
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#125Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#126[EDIT] I suggest looking at your situation from this perspective: $100,000 is a lot of money and can last you and your family over a year in certain places.
I don't really get the downvotes to the parent comment. All he's saying is "100k now might worth more than 5 million in 5 years"
It's hard to imagine a scenario where that is true, except maybe if you needed the money for lifesaving surgery for yourself or a family member, or some other equally dire circumstance. Even if you had to be homeless for 5 years it would be worth it to wait.
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#127Offer your shares to the investors putting in to the next funding round, at the same valuation. Just make sure you know those terms - don't commit to them blindly.
If you believe in the company, the consider not selling.
If you do not believe in the company then make sure you get this cash - you might end up the only person to actually make money from the company (this happened to me).
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#128Ask HN: I don't want to be a founder anymore
https://news.ycombinator.com/item?id=14417758
4 days ago
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#129Don't be a shmuck. Don't sell. Get an attorney, talk with the CEO only through the attorney. Find someone like jacquesm or I can refer you to someone to help you negotiate. 5% of XX,000,000 is at least $500k; you're a fool to take less.
The valuation of $XX,000,000 is typically based on investor purchase price, which almost always includes a liquidity preference likely not factored into OP's shares. If an investor buys 10% of the business with a 2x liquidation preference for $2,000,000, it's not accurate to say "the business is now worth $20,000,000". But TechCrunch and other news outlets will omit this all the time. (And let's not leave out that his stake will be diluted after the round.)
Furthermore, "a bird in the hand is worth two in the bush". Don't neglect the value of having money here and now you can invest in other assets: a downpayment on a home, stock market investment, etc. Many people in SF would have done better to have just purchased a modest home in 2010-2012 or bought TSLA than to have played the startup lottery over and over.
Re: Ask HN: Ex-Founder. Should I take lowball buyout offer?
#130Earlier quoted context omitted.
You are assuming all wrong. Start by offering a tenth of what you would agree to pay. All you risk is that they accept your offer. It's standard business practice. Works more often than not.
Why a tenth? Why not 1%?
Where "what I'm owed" is quite vague, or has only recently increased as in the case of growth companies, 10 or 20% might actually be accepted, or at least interpreted as a good faith start to negotiations.
An offer of 1% is more obviously not the correct amount, and encourages people to lawyer up rather than counter offer (it screams "we're only offering this token amount because someone suggested our original plan of not giving you anything might not work")