Re:Silicon Valley's best kept secret: Founder liquidity
by kelnos on Wednesday June 12, 2024 @09:03PM
(#40664875)
> If the 100% upside is guaranteed, then sure, you should hang on.
Overall agreed, but that's not even always true! If you're -- for example -- under crushing levels of debt today, you very well may want to take that $500k now, even if that $50M is 100% guaranteed in 5 or 7 or 10 years.
Or even if you aren't in debt, but would find it a huge quality of life improvement to be able to have a down payment for the house you'd really like to live in now, and not have to wait 5 or 7 or 10 years.
I guess you'll feel pretty bad if you pay for car insurance for 40 years, and never have a crash.
If the 100% upside is guaranteed, then sure, you should hang on.
But if "anything can happen" then cashing out 10% now, and providing a "can't fail" safety net, is well worth it. The reduction of risk of "losing it all" is well worth the 10% premium. And if the (somewhat unlikely) big exit ever happens you still have 90%.