I sold Baremetrics
baremetrics.com
I sold Baremetrics
1–10 of 521 posts
Re: I sold Baremetrics
#2The part about the investors getting nothing while the founder gets millions is really interesting. How does something like that even happen?
Re: I sold Baremetrics
#3I really appreciate the lack of “our incredible journey” platitudes in here.
Re: I sold Baremetrics
#4The part about the investors getting nothing while the founder gets millions is really interesting. How does something like that even happen?
Agreed. Why on earth would investors agree to not getting their money back?
Did they get anything? It doesn’t sound like it.
What are we missing here?
Re: I sold Baremetrics
#5I've always loved the transparency and frank writings by Baremetrics.
> As part of the structure of the deal, Xenon guaranteed I’d take home $3.7m, regardless of what came up during due diligence
Interesting, I wonder how this is structured - surely there are items that can come up during due diligence that are deal-breakers for Xenon, and surely due-diligence is performed before the contract is closed?
> But they were incredibly gracious and both agreed to write off their investment. General Catalyst’s (who had the lion’s share of that $800k) response showed just how classy they are: “We recognize the work that’s gone into the past 7 years and it sounds like this is a great landing spot for the team. We’re grateful for the opportunity to have supported you along the way.”
I have no idea how they managed to get the investors to walk with nothing, when the founders walked away with so much.
Re: I sold Baremetrics
#6The part about the investors getting nothing while the founder gets millions is really interesting. How does something like that even happen?
Agreed. Why on earth would investors agree to not getting their money back? Did they get anything? It doesn’t sound like it. What are we missing here?
Two things come to mind.
1. At the end of the day, investors are people too. They may care that the team ends up whole.
2. 800k is non-trivial money, but it’s a small percentage of, say, a $100MM VC seed fund. The economics of VC are that some investments will net zero return. While they could have tried to claim back something here, letting go with grace gives them a lot of goodwill to be first to invest in the founder’s next project (assuming there is one).
Re: I sold Baremetrics
#7I've always loved the transparency and frank writings by Baremetrics. > As part of the structure of the deal, Xenon guaranteed I’d take home $3.7m, regardless of what came up during due diligence Interesting, I wonder how this is structured - surely there are items that can come up during due diligence that are deal-breakers for Xenon, and surely due-diligence is performed before the contract is closed? > But they we…
Good faith decisions go a long way, if they believe in the founder that 800k becomes an investment to be front-of-line for his next company. The economics make sense insofar as that sum isn’t going to move the fund’s returns a whole lot.
Re: I sold Baremetrics
#8The part about the investors getting nothing while the founder gets millions is really interesting. How does something like that even happen?
Agreed. Why on earth would investors agree to not getting their money back? Did they get anything? It doesn’t sound like it. What are we missing here?
"A small but reasonable exit is life-changing for me, and a nulled-out investment is expected for you in most of your investments."
Some investors are gonna be ruthless sharks. Others are not.
Re: I sold Baremetrics
#9Earlier quoted context omitted.
Agreed. Why on earth would investors agree to not getting their money back? Did they get anything? It doesn’t sound like it. What are we missing here?
Two things come to mind. 1. At the end of the day, investors are people too. They may care that the team ends up whole. 2. 800k is non-trivial money, but it’s a small percentage of, say, a $100MM VC seed fund. The economics of VC are that some investments will net zero return. While they could have tried to claim back something here, letting go with grace gives them a lot of goodwill to be first to invest in the foun…
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Re: I sold Baremetrics
#10$3.7 million sounds like a lot of money, but he could have earned more than that over 7 years if he just took a mid-level job at a FAMANG company.
EDIT: saw that the founder lives in Birmingham, Alabama. So yes, $3.7 million IS a lot of money.