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Valuable to new investors. Old investors get hosed. I really struggle with these sorts of situations. She’s presumably doing something similar with the new company so all the old investors who didn’t participate (presuming a pay to play) get hosed. Is that really fair?
The chosen and the hosen
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Valuable to new investors. Old investors get hosed. I really struggle with these sorts of situations. She’s presumably doing something similar with the new company so all the old investors who didn’t participate (presuming a pay to play) get hosed. Is that really fair?
In my experience, the alternative to a pay to play or similar situation in which the old investors get hosed is the company dying, so they get hosed anyway. The fact is, a messed up cap table or zombie company is not attractive to new investors, so cleaning it up is an unfortunate necessity.
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In my experience, the alternative to a pay to play or similar situation in which the old investors get hosed is the company dying, so they get hosed anyway. The fact is, a messed up cap table or zombie company is not attractive to new investors, so cleaning it up is an unfortunate necessity.
IMO the investors deserve a fair price for her 'buying' her old trash. I assume they won't get it and she'll be able to buy her old trash for pennies, probably 100 of them.
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IMO the investors deserve a fair price for her 'buying' her old trash. I assume they won't get it and she'll be able to buy her old trash for pennies, probably 100 of them.
A typical startup would require the consent of a majority of the investor shares for a sale of all the assets, so there would be investor protection and consent to this type of a transaction. And indeed this article says “Almost all of Sunshine’s investors, who include Norwest Venture Partners, Felicis Partners, and SV Angel, have signed off on the deal, Wired cited the sources as saying.” So the investors think what…
Do you know which investor isn’t cruising over?
> Both apps have been downloaded just over 1,000 times on the Google Play Store. The company had raised about $20 million in 2020. $20K per free app download?
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In my experience, the alternative to a pay to play or similar situation in which the old investors get hosed is the company dying, so they get hosed anyway. The fact is, a messed up cap table or zombie company is not attractive to new investors, so cleaning it up is an unfortunate necessity.
Maybe the company should just die? It failed and now they’re spinning out… why?
One way to look at it is do you want zero or do you want pennies on the dollar for it?
Is it crappy? Yeah. Doubly so if being abused by the founder. There is a version of this that is just the best of two bad options though.
It leaves a bad taste in my mouth when the founder doesn't share the same pain as the investors and the employees but such is life and it's hard to draw a line anyway, especially for someone super rich and with star power like her.
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Clean cap table and she probably provided a decent amount of the funding for the first startup. It's also more than likely a tax thing here. I don't think people ought to get too obsessed with the contractual details on this one.
If she has any investors with preferences, she probably isn’t seeing a dime.
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>Have any of her attempts post google worked? Yes. She made a tremendous amount of money for herself while failing miserably at Yahoo!. Oh, you mean attempts at getting workable, groundbreaking new products out into the market with success? No.
> Yes. She made a tremendous amount of money for herself while failing miserably at Yahoo!. I was at Yahoo from 2004-2011, so I've got my opinions, but I think failing miserably at Yahoo is like the default option. It was a great gig to take in 2012 --- if you do well, well then it's clearly your leadership; if you don't do well, it's that Yahoo wasn't salvageable.