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| ▲ | em-bee a day ago | parent | next [-] |
| but the opposite is true too: don't take money from investors unless they let you keep control of your company. for every case like this there are probably a dozen cases where investors took control of a company and ruined it for the sake of making money. |
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| ▲ | pclmulqdq a day ago | parent [-] | | How did they "ruin" a company if that company made money? | | |
| ▲ | diggan a day ago | parent [-] | | Not all humans are driven by the same motivations. | | |
| ▲ | pclmulqdq a day ago | parent [-] | | Presumably if you as a founder are not driven by a desire to make money and your investors are, you 100% should be ousted. This is the principal-agent problem at work. | | |
| ▲ | diggan a day ago | parent [-] | | > Presumably if you as a founder are not driven by a desire to make money and your investors are, you 100% should be ousted Presumably, the real world is a bit more nuanced than that. There is no reason why you cannot run a company for different motivations than "get as rich as possible" while still accepting investments from people whose sole motivation is "get as rich as possible". While difficult, it is possible to align people even when they have different motivations. | | |
| ▲ | pclmulqdq 17 hours ago | parent [-] | | What you are describing is exactly the principal-agent problem, and it is a real problem at startups when a founder is truly motivated by something that the investors don't care about. You can run a company with different motivations than your investors, but only so long as you return the goods they want. If they see you not returning the goods and not caring about that fact, they will try to replace you. They will try to do that a lot faster if you demonstrate that you don't care about giving them a return than if you show that you do care. Conversely, investors can be mission-driven or otherwise aligned with you on something other than "maximize my return," but those investors rarely give you the best price. |
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| ▲ | toomuchtodo 2 days ago | parent | prev [-] |
| Same with trading your time for stock options (that you hope are eventually negotiable shares); trust is earned in drops and lost in buckets. |
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| ▲ | SJC_Hacker 2 days ago | parent [-] | | Dilution is a real problem. If they want you to act like a Founder, you should have protected equity like one. |
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