Basic VC Maths – Part 1

From a recent Steve Blank interview.

Still don’t think that many entrepreneurs fully comprehend this:

Q. And they’re putting down real money, so they want their entrepreneurs to succeed.

 

A.Your interest and your V.C.’s interest in liquidity may not be the same. Those who take big V.C. money have signed up for, “We’re going to be a home run or we’re going home.” That’s the interest of the V.C.’s. They have a portfolio of 10 or 15 investments, and they’re going to swing for the fences on all of them. That’s their business strategy. But you might not have realized what you signed up for. Because if someone had sat you down and said, “Would you be happy if it got sold for $25 million?” you would say, “Yeah, I get to take home $5 million, that’s more than I’ve ever seen.” But that’s not your V.C.’s strategy.
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4 comments

  1. Pingback: Basic VC Maths – Part 2 | interesante
  2. Pingback: Basic VC Maths – Part 2 | 25Fifteen
  3. Pingback: Basic VC Maths – Part 3 | interesante

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