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New Trends In Startup Financing Explained For Laymen (kalzumeus.com)
95 points by subbu on Sept 2, 2010 | hide | past | favorite | 11 comments



This was originally the comment here ( http://news.ycombinator.com/item?id=1655325 ), but somebody asked me to blog it. I added some pretty pictures.

I'll shut up for a while now, I promise.


Patrick,

I think I vouch for everyone on HN when I request you to not shut up. Please keep these comments/blog posts coming. :)


You should blog this one too: http://news.ycombinator.com/item?id=1633062


I wouldn't worry about the quality, the way you do lower in the thread, it's excellent.

About your parting words:

> I rather like getting 100% of the returns.

Do you mean that you'd rather run a smaller company at 100% than to have a larger company with outside investors or do you mean that you don't think you'd be doing significantly better if you had more money to spend to grow your business?

The first would make sense, that's a personal preference, but if it is about the return itself in an absolute sense then outside capital can (but doesn't have to be) a booster, you could come out ahead even after the fact that you no longer have 100% is factored in.


Thank you! Now if someone could tackle the rest of the variables in startup funding in the same easy-to-follow manner, they'd get some seriously good karma (not points, actual goodwill).


I was the one who suggested that. Thank you.


Similarly, Martin from Rapportive wrote almost the same thing back in May (graphs and all): http://www.yes-no-cancel.co.uk/2010/05/05/valuation-caps-on-...


You know the feeling you get when you spend two hours coding up a fairly clever way to do something and then you find out it would have been a tenth of the work if you had checked the standard library first? Yeah, that is what I'm feeling right now.


Yours is easier to read. Wasn't wasted.


Keep updating it. There is a lot more to the situation than the numbers.

Why are they bad? Why are they good? How can they misincentivize bad behavior? The situation is complex


Added to my "Great Articles" repository. I'm looking to create version 0.2 soon, incorporating the lessons I'm learning from using the current, butt-ugly pre-alpha version.




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