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Poll: Would you sell your startup for 5x to Google so they can kill it?

news.ycombinator.com

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Re: Poll: Would you sell your startup for 5x to Google so they can kill it?

#31

Post by mindcrime »

Maybe, but it's hard to say. As somebody else said, it would depend on the valuation. Right now, we're pre-revenue, so any valuation would presumably be pretty small, so even at 5x, the overall price would be fairly small. It probably wouldn't be worth it to sell at this point, even if the opportunity existed.

Now if the company were valued at, say, $10,000,000 and they offered us $50,000,000, that would be awfully hard to say "no" to.

Edit: Voted "yes" since there is at least a hypothetical scenario where the answer would be yes.

Re: Poll: Would you sell your startup for 5x to Google so they can kill it?

#34

Post by timjahn »

YuriNiyazov wrote: post #3

Because the "I am a visionary that will change the world" is a game better played by people whose mortgage is paid off and who have enough savings to pay for their kids' college education. Also, having a successful exit (and success in this case is measured by the return to your investors, not whether the product survived the acquisition) does wonders for your startup career.

Exactly.

Until you have financial freedom, the goal is financial freedom.

Re: Poll: Would you sell your startup for 5x to Google so they can kill it?

#37

Post by failedthrowaway »

dylangs1030 wrote: post #18

Yes, for several reasons. I'll assume this is my first startup, and I started out at the bottum rung in the tech world, with no prior connections. 1. Most startups (by an incredible supermajority) fail. An acquisition can save you from that, especially if you're one of those startups that generates no revenue but is extremely popular. 2. Not only do most fail, they don't generally fail spectacularly. They die, slowly…

2. Not only do most fail, they don't generally fail spectacularly. They die, slowly and steadily, in a death march that saps the founders of their confidence and has been documented several times to lead to severe depression[1].

My company failed, a long slow death, after 8 years. I was barely able to pay myself during the latter few years, but I had employees and cofounders that I felt obligated towards... and then company debt I needed to work off. While we have shut it down now and I have a full time job, I feel dead inside, and I am having a rough go at being functional. I hide it from my family, and am finding it hard to be productive. I'll just stare at the screen instead of working. I don't know what to do to jump start myself again. I feel so empty and like I am fake. It has been two years. I haven't said this to anyone before now. But I believe you are right about the slow company death, and while I don't believe I am severely depressed, I do feel a bit like Frodo at the end of LoTR, but without a Grey Haven sanctuary to sail off towards.

(Sorry for the rambling and the thread hijack)

Re: Poll: Would you sell your startup for 5x to Google so they can kill it?

#39

Post by mathattack »

Let's assume a few things:

1) The base valuation is high enough to be significant.

2) It's not a passion project.

3) I have other ideas.

4) The IP stays with the company.

5) The employees get taken care of.

As long as 1, 2 and 3 are true, it's worth getting the money to start the next thing. I include #4 because it's kind of a copout to assume you can start over with a forked code base. Then it's not a real choice. #5 is included because what goes around comes around. If the founder takes the money and runs, but everyone else gets screwed, it'll be much harder to start the next business.

#2 and #3 are really the critical pieces. It's the difference between "This is special" and "This is one idea of many." Microsoft, Google and Facebook all would've answered "No" to a similar question. In all 3 cases it was the founder's first company, so they weren't playing with the House's money.

Very good question!

Re: Poll: Would you sell your startup for 5x to Google so they can kill it?

#40

Post by gvr »

I think it depends on a lot of different things, including how over/undervalued YOU think your startup is by other people than Google, and irrespective of financials how excited you are about the idea.

The question might be easier to answer if it was: "Would you sell your CURRENT startup TODAY for 5x what INVESTORS think it's worth (to Google so they can kill it)?"

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