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Zapier reached a $5B valuation with $1.3M of funding

forbes.com

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Re: Zapier reached a $5B valuation with $1.3M of funding

#51

Post by dang »

vmception wrote: post #7
_gmnw wrote: post #6

They did take VC funding though? By pulling themselves up by their bootstraps (and a meager $1.3 million in funding) they were able to start a company! That's not an insignificant sum of money, I see that they didn't take further rounds, but still this feels like a nice marketing piece with a bad headline.

The article says “hamster wheel”, not that they didn’t take it. The headline here adds ambiguity that wasnt written

OK, we've disambiguated that in the title above. (Submitted title was "Zapier reached a $5B valuation without VC funding".)

Re: Zapier reached a $5B valuation with $1.3M of funding

#52

Post by notyourday »

vladislav wrote: post #48
_gmnw wrote: post #6

They did take VC funding though? By pulling themselves up by their bootstraps (and a meager $1.3 million in funding) they were able to start a company! That's not an insignificant sum of money, I see that they didn't take further rounds, but still this feels like a nice marketing piece with a bad headline.

It's strictly speaking correct in that the $5B valuation was established purely on the secondary market and only from sales of shares of investors (not common holders), which doesn't give the company any VC funding. Also $1.3M in seed funding is a rounding error to get to $5B.

This smells like a sophisticated investor pump and dump: sell a small number of shares for a stupid amount to use the new valuation as the marker.

I would trust this number far less than a number one would arrive at a new VC round

Re: Zapier reached a $5B valuation with $1.3M of funding

#53

Post by capableweb »

Kaze404 wrote: post #39
capableweb wrote: post #22

Earlier quoted context omitted.

Very unlike HN to upvote a comment that has reacted only to the headline on HN, not even the articles own headline, even less the body of the article. Maybe because everyone reading the comments is doing it the same way?

What's wrong with criticizing a headline that presents factually untrue information?

It's a editorialized headline that only appears on HN. The submission itself (it's content) doesn't actually say anything like the title is (was? Seems title changed)

Re: Zapier reached a $5B valuation with $1.3M of funding

#54

Post by _jxdz »

bradlys wrote: post #16

Congrats to the founders for not taking much funding but for employees... this has to suck unless they get to sell their shares to Sequoia as well. (If they even got any options...) Maybe they don't compete for SV talent and most employees aren't used to even getting options as part of compensation. Is there a specific reason a company would have IPO in mind but wouldn't say they are looking to do an IPO eventually?…

I believe only a few of the original Zapier folks have options (I don't hold any myself, for example but I joined when they were around 70 people).

Re: Zapier reached a $5B valuation with $1.3M of funding

#55

Post by dang »

Kaze404 wrote: post #39
capableweb wrote: post #22

Earlier quoted context omitted.

Very unlike HN to upvote a comment that has reacted only to the headline on HN, not even the articles own headline, even less the body of the article. Maybe because everyone reading the comments is doing it the same way?

What's wrong with criticizing a headline that presents factually untrue information?

It tends to take the thread to a shallow place, when there are usually much deeper and more interesting aspects to discuss.

Re: Zapier reached a $5B valuation with $1.3M of funding

#57

Post by artemonster »

toomuchtodo wrote: post #43
superbcarrot wrote: post #29

Sometimes I get shocked by these numbers and it reminds me how little I know about business. Like if you showed me the wikipedia page for Zapier and asked me give it some value, I would be way off. Or if you pitched the business idea to me, I would tell you do something better with your time.

Khan Academy has an amazing collection of videos on finance. I highly recommend it for understanding cash flows, enterprise value, etc. It's helped me transition (one foot out the door) from tech to finance.

Any other good sources, like books or articles ?

Re: Zapier reached a $5B valuation with $1.3M of funding

#58

Post by ben-gy »

redisman wrote: post #26
bpodgursky wrote: post #5

Earlier quoted context omitted.

Having the right investors adds value in a way a bank holding a loan absolutely never will.

But if the company is using money as "100% gasoline" then they've got it figured out and don't need intros from the investors.

Correct - accelerant can be traded for “equity for lots of cash plus advice” or purchased “cash for advice” - I’m a big fan of bootstrapping to a financially stable state and having the option to take either route without the business being reliant on either - then again, in Australia we don’t have much choice anyway - venture capital and banks are both exceedingly conservative which perpetuates this approach more so than in other ecosystems with more funding liquidity.

Re: Zapier reached a $5B valuation with $1.3M of funding

#59

Post by dang »

enra wrote: post #23

The article title is accurate, the one in HN right now is not. The point was that they did YC and seed round but didn’t raise funding after that. Traditionally startups raise every 18mo and have raised A,B,C,D etc in ~10 years and before hitting $5B valuation. Even with the latest round, it was a secondary sale, so not dilutive raise. Some investors sold shares to other investors but no new shares where created. Avoi…

(The submitted title was "Zapier reached a $5B valuation without VC funding". We've changed it now.)

Re: Zapier reached a $5B valuation with $1.3M of funding

#60

Post by propter_hoc »

_jxdz wrote: post #54
bradlys wrote: post #16

Congrats to the founders for not taking much funding but for employees... this has to suck unless they get to sell their shares to Sequoia as well. (If they even got any options...) Maybe they don't compete for SV talent and most employees aren't used to even getting options as part of compensation. Is there a specific reason a company would have IPO in mind but wouldn't say they are looking to do an IPO eventually?…

I believe only a few of the original Zapier folks have options (I don't hold any myself, for example but I joined when they were around 70 people).

Really? Only cash comp?
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