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Rich vs. King in the Real World: Why I sold my company

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Re: Rich vs. King in the Real World: Why I sold my company

#31

Post by stavros »

kansface wrote: post #21
agsamek wrote: post #18

Earlier quoted context omitted.

2M for 600k profit was just a very poor offer and your father chose right regardless of what happened next. (Judged by the limited information provided)

Considering the company went bankrupt shortly thereafter, the offer actually reflected the actual value of the company. Its hard to know that at the time.

Then it didn't reflect the actual value of the company. It was a low offer, and the unpredictable events are just that: unpredictable.

The winning lottery ticket still costs $1, because you don't know if it's going to win.

Re: Rich vs. King in the Real World: Why I sold my company

#32

Post by StavrosK »

nugget wrote: post #12

I'm curious what the author and others think is a reasonable "freedom line". Silicon Valley is pretty expensive and it's hard to know exactly what's implied when someone says "never have to work again". Of course everybody is different and has different expenses, but it's a worthwhile data point.

Living in Greece, I just calculated it at $35k per year. Now to find something that will allow me to make that kind of money without working (too much)...

Re: Rich vs. King in the Real World: Why I sold my company

#33

Post by mesozoic »

agsamek wrote: post #18
Alan01252 wrote: post #3

Earlier quoted context omitted.

My Dad did exactly the same thing. He ran a steel company with profits of around £600,000 was offered ~£2 mill for the company and turned it down. The recession of the 1990's came and completely wiped out the steel/construction industry and his company went under. In the highly unlikely event I'm ever given that opportunity I'll definitely pick Box A, I've seen first hand just how hard it can be when Box B doesn't wo…

2M for 600k profit was just a very poor offer and your father chose right regardless of what happened next. (Judged by the limited information provided)

Exit multiples for steel mills aren't quite the same as for tech companies.

Re: Rich vs. King in the Real World: Why I sold my company

#34

Post by mesozoic »

nugget wrote: post #12

I'm curious what the author and others think is a reasonable "freedom line". Silicon Valley is pretty expensive and it's hard to know exactly what's implied when someone says "never have to work again". Of course everybody is different and has different expenses, but it's a worthwhile data point.

It's probably around $5m in the bank as that's around when you can draw a reasonable income from fairly safe investments without it decreasing.

Re: Rich vs. King in the Real World: Why I sold my company

#35

Post by majani »

I think alot of the angst that comes towards people who sold their companies, is simply using the term "sell." That gives the impression that you went out and shamelessly hawked your product to the highest bidder.

I personally find that if you instead say that so and so was "bought out" by a bigger company, then that's much easier to come to terms with for most people. That phrase gives the impression that a bigger company saw much value in your company and just had to have it for themselves, leaving you little choice in the matter.

Re: Rich vs. King in the Real World: Why I sold my company

#36

Post by hkarthik »

ChuckMcM wrote: post #23
michaelochurch wrote: post #9

I'd take Rich. I hate that I would, but I would. I'd make that call not so I can quit working full-time. I'm only 29. I'd take it so I can start working full-time. So I can guarantee that I focus on real work for the rest of my active life. Liberate the cognitive 1% from subordination, and creation (real work) happens. (Humility is not a virtue in people like me. If we don't raise up our confidence to overwhelm Autho…

Two comments, one actual and one meta :-) So your statement is that you'd take 'rich' so that you could work on 'king.' (trust me working full time on " real work" has King written all over it). Tom Lyon (emp #7 at Sun) told me early on in my years there that you really needed 3 startups, one paid for by VC's that taught you about what startups were all about. Then you need one that you founded but was VC funded that…

From a timeline perspective, let's see how the rule of 3 startups would work out to become King.

Ages 22-25: Fresh out of college, work for a startup as an employee and learn the ropes, build connections, and level up with the right skills.

Ages 25-30: Strike out on your own with Startup #1. Work at it for 5 years (because the VCs totally own you) and then bail.

Age 30-33: Start another startup with VC funds, but negotiate better terms. Work at it for 3 years to get the 7 figure exit.

Age 33+: A full 13 years after you began your career, you're finally ready to bootstrap a business with no VC at all. Maybe now you can actually slow down enough to get married, have a family, and put down some roots. Well hmm, now with all those responsibilities on the line, it seems foolhardy to risk your own cash from the previous ventures when VCs are willing to give you money again...

Re: Rich vs. King in the Real World: Why I sold my company

#37

Post by jedberg »

There is a viable middle ground. Sometimes these days, when you build a solid business, an investor is willing to let you cash out with some of their investment. Essentially, they are moving you from the left of the line to the right, so you can be rich and then focus on "king".

Re: Rich vs. King in the Real World: Why I sold my company

#38

Post by michaelochurch »

hkarthik wrote: post #36
ChuckMcM wrote: post #23

Earlier quoted context omitted.

Two comments, one actual and one meta :-) So your statement is that you'd take 'rich' so that you could work on 'king.' (trust me working full time on " real work" has King written all over it). Tom Lyon (emp #7 at Sun) told me early on in my years there that you really needed 3 startups, one paid for by VC's that taught you about what startups were all about. Then you need one that you founded but was VC funded that…

From a timeline perspective, let's see how the rule of 3 startups would work out to become King. Ages 22-25: Fresh out of college, work for a startup as an employee and learn the ropes, build connections, and level up with the right skills. Ages 25-30: Strike out on your own with Startup #1. Work at it for 5 years (because the VCs totally own you) and then bail. Age 30-33: Start another startup with VC funds, but neg…

What's sad is that, as bad and wasteful as that trajectory sounds, it's the 99.9th percentile outcome.

Re: Rich vs. King in the Real World: Why I sold my company

#39

Post by ChuckMcM »

hkarthik wrote: post #36
ChuckMcM wrote: post #23

Earlier quoted context omitted.

Two comments, one actual and one meta :-) So your statement is that you'd take 'rich' so that you could work on 'king.' (trust me working full time on " real work" has King written all over it). Tom Lyon (emp #7 at Sun) told me early on in my years there that you really needed 3 startups, one paid for by VC's that taught you about what startups were all about. Then you need one that you founded but was VC funded that…

From a timeline perspective, let's see how the rule of 3 startups would work out to become King. Ages 22-25: Fresh out of college, work for a startup as an employee and learn the ropes, build connections, and level up with the right skills. Ages 25-30: Strike out on your own with Startup #1. Work at it for 5 years (because the VCs totally own you) and then bail. Age 30-33: Start another startup with VC funds, but neg…

There is another path, marry an engineer and delay starting your family for a few years. It worked out pretty well for me. While she was working we always tried to balance risk between the two jobs so that either one of us having our job go poof would still have enough runway to recover.

I certainly agree doing it all yourself is going to be a challenge.

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