131–139 of 139 posts
Earlier quoted context omitted.
$1200/year, not per month, and according to this tweek the business had "tanked" in recent years: https://twitter.com/monstro/status/585797874300035072 . Edit: Actually $1200/month according to the pricing page, nevermind. That's insane, and way above competitors like ZenDesk.
It must have tanked pretty damn deep then... How many customers at $1200/mo per shot do you need to feed 9 employees?
According to their website they have 1000s of customers paying 1200+/m. At the low end they're getting 1.2 million in revenue a month and only have 9 employees. Why did they sell? Something is not adding up.
Earlier quoted context omitted.
I forgot about the debt holders. So if there was any debt (including un-converted convertible notes), the pecking order is: 1) Debt holders 2) Most senior shareholders and their liquidation preference 3) Less senior shareholders and their liquidation preference ... 99) Common stock holders This is actually to align the founder incentives in shooting for a big exit. Insert any other order of preferences, and the found…
Number one preference is the tax man isn't it? At least in the UK, he always gets paid first.
The company tanked after having elected to raise $20M over 5 rounds, for what should have been a very profitable lifestyle business. The lesson is not to raise VC money for a business where it does not make sense.
I have very limited knowledge of this situation, but, I'm gonna pile on anyway: With that kind of money raised, the founders didn't get "nothing". They got a salary, probably a decent one, for however long they were running the thing. Which is more than many startup founders get out of businesses that fail. If they don't have personal debt, or didn't lose relationships or friendships, they came out ahead of many star…
"With that kind of money raised, the founders didn't get "nothing". They got a salary, probably a decent one, for however long they were running the thing. Which is more than many startup founders get out of businesses that fail. If they don't have personal debt, or didn't lose relationships or friendships, they came out ahead of many startup founders who started a business that failed." Well, you should always consi…
I think you'd be surprised. The A-round term sheets I've had come my way over the years specified a salary for founders bigger than any I've ever received working for other companies. It was more of a suggestion than a requirement of the deal, I think, but it gave some clues about the salaries the investors would be comfortable with the founders being paid. It was always generous. Not "C-level at Google" high, but certainly better than "low or mid-level developer at almost any company in the US, including good ones".
By the time you are raising millions of dollars, you are drawing a decent salary. Maybe you could make more somewhere else, but I believe it's more likely you'd make less.
Earlier quoted context omitted.
I seem to remember at the time there was about 1/2 year - year where Google loved them and you'd get a Get Satisfaction result for googling "[company name] support". GS were HN darlings for a little bit, then started getting annoying because you'd land on this pointless page, then 37signals (rightfully) publicly called them out, then google seemed to delist them in a panda or something and then everyone forgot about…
I'm a former Get Sat employee (I left about two months ago). While the company may have done that early on, we definitely did NOT continue that at any point when I was there. There were a few communities like that we still kept up because there was some activity, but we certainly weren't adding new ones. In fact, we were actively pruning communities that had no activity and were on the old, free accounts when I left.…
Wow, the arrogance of expecting 'hush money' and complaining if you don't get it? Liquidations preferences are pretty much the norm in Silicon Valley, if they didn't understand how they worked when they chose to get outside investment, then they never should have agreed to the liquidation preferences to begin with (which may easily mean they never should have gotten outside investment to begin with). They made a gamb…
Earlier quoted context omitted.
Number one preference is the tax man isn't it? At least in the UK, he always gets paid first.
That's not been true for a long time. The only "preferential creditor" in the UK now are employees, HMRC take their chances with all other debtors.
As a technical founder, I'd be very careful to start a company again. I used to ignore finance and bureaucracy, but the industry has changed a lot. The popular quote 'just passionately build something' is nothing but a trap. Although something like YC doesn't fit this profile, one will eventually find himself in a hostile situation.
Maybe don't take buckets of cash that you don't/shouldn't need? That $XXmm isn't free and is a good way to hand someone a leash tied around your neck. It looks like Get Satisfaction raised $20mm. Why that much? Did all that money contribute towards success? Or was a good chunk of that money not utilized well? Why did the company tank? Were they not acquiring enough customers? Was their business model unsound? What fo…
The issue is that the founders were pushed out. Lane indicates that business tanked ever since they left, which is what presumably led to a fire sale.
It's one thing if the business tanks when founders are in-charge. You can blame them for failure and say it's fair that they din't get a dime. But why did the VCs take over the reigns? It's criminal to take over from founders and then run the business into the ground, like it seems to have happened here.
Of course, that Series B happened looooooong back. There was no Series C in the following year or two years after that, which might be why investors got jittery. The timing matters - did the founders get pushed out after a decent amount of time after the Series B? Or was it right after the investment? That would tell whether the VC had some reasonable cause to get desperate or they were just trying to "screw" the founders.