FTX’s Sam Bankman-Fried cashed out $300M during funding spree
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Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#2[deleted]
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#3Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#4How common was it for founders to cash out on common shares in the Series C-E rounds the last decade?
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#5> the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals.
The most fascinating part of this whole story to me is just how few checks and balances there were in this company. Even without a board, did major investors not get his quarterly financials? If the leaked balance sheet was any indication of their level financial engineering capabilities, it's hard to imagine there weren't major red flags through most of 2021.
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#6I don't know if it will happen, but a potentially good outcome here would be some regulation on the business practices of sufficiently large private companies in order to ensure they meet some basic level of corporate governance. Maybe they don't need the same level of scrutiny publicly traded companies have, but establishing minimum standards of conduct would help avert crises like this that can spread across entire sectors.
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#7For people looking for prosecution like embezzlement or something else, these things usually rely on a violation of company policy then enabling a violation of a criminal law
FTX/Alameda had no company policies and in this case disclosed what they were going to do to investors. “Buyout binance’s stake”.
There is only so much the governments do to prevent you from wiring money to a sketchy opaque shadow bank in the Bahamas.
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#8How common was it for founders to cash out on common shares in the Series C-E rounds the last decade?
if the investors are willing to buy your shares from you, then why not? I've done secondary sales as early as seed. Unless you hide it from the board somehow, or you are explicitly prohibited from doing this, it's just a business transaction.
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#9How common was it for founders to cash out on common shares in the Series C-E rounds the last decade?
if the investors are willing to buy your shares from you, then why not? I've done secondary sales as early as seed. Unless you hide it from the board somehow, or you are explicitly prohibited from doing this, it's just a business transaction.
Not an ethics question of why or why not, I'm just curious.
Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree
#10How common was it for founders to cash out on common shares in the Series C-E rounds the last decade?
Pretty common. With startups waiting ten years to IPO, many founders and employees would "take money off the table" along the way.