Re:I sold Baremetrics
by Topgamer7 on Tuesday November 10, 2020 @10:35AM
(#25047087)
I'm not the most financially savvy person. And I am not an attentive follower of Baremetrics. But wouldn't the investors have been getting dividend returns quarterly all along since their investment was made?
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Re:I sold Baremetrics
by texasbigdata on Wednesday November 11, 2020 @01:34AM
(#25056044)
A) dividends require positive cash flow or positive profits, which might have not happened here. B) some preferred equity investors do just that. It’s a bit rarer but you can see a PIK 8% piece of pref with 4% current cash pay and a 4% accruing liability.
VC startups don’t generally pay dividends due to the cost of capital requiring reinvestment of profits (if any) to make the growth targets work.