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Loopt acquired by payment card provider for $43.3m in cash

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Re: Loopt acquired by payment card provider for $43.3m in cash

#21

Post by sama »

rokhayakebe wrote: post #14
sama wrote: post #13

Happy to answer any questions I'm able to. Looking forward to the great stuff we're going to do at Green Dot!

1 - Would you say you guys were too early to market? 2 - Was your monthly active user base above 2M? 3 - What contributed to Loopt loosing its appeal over the past 12/18 months?

1. yes, although that gave us some advantages as well.

2. not for our core loopt app.

3. i think in general location services have lost some luster over the last 12/18 months, but i also think a lot of the things that we've been doing--real-time deals, loyalty offers, etc are generating a lot of interest among users and we'll hopefully be able to take that to the next level at green dot.

Re: Loopt acquired by payment card provider for $43.3m in cash

#22

Post by shareme »

alapshah wrote: post #9

In case anyone is missing what has happened here, this is why people hate on private equity/VC. As far as I can tell, Loopt wasn't doing very well. http://www.google.com/insights/search/#q=loopt.com&cmpt=... They had an attempt to revive the company to compete with Groupon last year that many here thought was stupid and died an early death ( http://news.ycombinator.com/item?id=2696412 ) Michael Moritz (Sequoia partne…

some backstory..beware personal opinion

I had the opportunity to interview with Loopt sometime ago, right when they in fact did the name change to Loopt.

My read than was that they in long term terms were going to fail as certain constraints to do things were not in their best interests...at that time it was Mobile Operator limits..tie-=ups

Its a sad thing as current deal looks to be only based on patents values..not what Sam's team put into it..

Re: Loopt acquired by payment card provider for $43.3m in cash

#23

Post by nikcub »

alapshah wrote: post #9

In case anyone is missing what has happened here, this is why people hate on private equity/VC. As far as I can tell, Loopt wasn't doing very well. http://www.google.com/insights/search/#q=loopt.com&cmpt=... They had an attempt to revive the company to compete with Groupon last year that many here thought was stupid and died an early death ( http://news.ycombinator.com/item?id=2696412 ) Michael Moritz (Sequoia partne…

raising debt to pay a dividend back to investors is more common than not amongst the LBO funds. it makes sense if you have a steady and decent income stream, it is a bit like drawing down on equity in your house in order to take a holiday, except the rates are much better (when people complain about this, I am not really sure what they want to be done about it)

the VCs of silicon valley are very far away from the Wall St type of private equity (although they are becoming closer with the secondary markets now opened up - it used to be that your vc investors were in all the way until the exit)

as for Sequoia, it is pretty well known that the top tier VCs look after their own. Look through the Sequoia history and you won't find very many outright failures, it is a reason why entrepreneurs choose to work with them. I very much doubt Moritz can 'make' Green Dot do the deal, but I am pretty sure he put it all together - it is more a testament to his/their dealmaking abilities than any leverage he would have as a minority shareholder and director in a public company.

Re: Loopt acquired by payment card provider for $43.3m in cash

#24

Post by suking »

sama wrote: post #20
suking wrote: post #19

Earlier quoted context omitted.

sequoia made them.

not true at all.

* ready to sell business because it wasn't going anywhere, sequoia knew greendot well and got them to get a return on the $ put in so it wasn't a total buss. Hence the huge (relative to the sale) incentive for founders to stick around since they got nothing from the sale. is my guess.

Re: Loopt acquired by payment card provider for $43.3m in cash

#25

Post by pg »

jgrahamc wrote: post #12
shingen wrote: post #8

Earlier quoted context omitted.

YC doesn't have any anti-dilution clauses in their terms? Surprising given their small stakes. All I've seen are the surface features of the YC deals, so I'm not up to speed on the specific terms they get.

The YC AA documents have a 1x preference (i.e. they can take their money out before distribution) and they have a right to reinvest pro-rata. http://ycombinator.com/seriesaa.html

Those aren't the terms we use. Those docs are something we and WSGR created for the startups we fund to use to when raising money later. We don't get any liquidation preference or pro-rata rights.

Re: Loopt acquired by payment card provider for $43.3m in cash

#26

Post by sgrove »

sama wrote: post #18
razin wrote: post #16

Earlier quoted context omitted.

Why did you sell?

We realized that to be really successful, we needed to be about finance and payments as well as location--I think the most interesting things will happen when those two come together. We talked to a number of companies and were most excited about the team and vision at Green Dot.

When did you realize that? Was it a slow change, or was there an epiphany? And was it a company-wide realization, or was there a champion behind it?

Re: Loopt acquired by payment card provider for $43.3m in cash

#29

Post by sama »

sgrove wrote: post #26
sama wrote: post #18

Earlier quoted context omitted.

We realized that to be really successful, we needed to be about finance and payments as well as location--I think the most interesting things will happen when those two come together. We talked to a number of companies and were most excited about the team and vision at Green Dot.

When did you realize that? Was it a slow change, or was there an epiphany? And was it a company-wide realization, or was there a champion behind it?

slow change i'd say, and lots of discussion about it although i was probably the strongest champion.

Re: Loopt acquired by payment card provider for $43.3m in cash

#30

Post by sama »

rdl wrote: post #27
sama wrote: post #13

Happy to answer any questions I'm able to. Looking forward to the great stuff we're going to do at Green Dot!

Congratulations! How long did the deal take to bring to this point (if that's public)?

i think i can answer this but let me double check.
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