Re:Could VC be a Casualty of the Recession?
by calambrac on Thursday December 04, 2008 @10:19PM
(#386552)
Why would you want later stage investors to drop out? You have early, cheap equity; don't later stage investors reset the valuation and give you a shot at cashing out if you want? (I really don't know, I'm actually asking).
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The valuation goes up between us and a series A round, but in a successful startup it should go up much more afterward.
Re:Could VC be a Casualty of the Recession?
by calambrac on Friday December 05, 2008 @01:53AM
(#386753)
How many companies that get a series A round end up being successful? It seems like having that opportunity to decide if you agree that the company will keep growing or that you've made enough and would rather reinvest in the next round of startups would be nice to have.
It wouldn't be nice to the startups to do that, because it would send an alarming signal to the series A investors that would drive down the valuation and maybe even prevent the round from closing.