Mackey: VCs push high burn rates to force cram-down rounds
John Mackey · John Mackey: Building Whole Foods · Oct 29, 2024 · at 35:00
Whole Foods co-founder John Mackey gives advice to entrepreneurs on the structural risks of VC-backed high-burn growth strategies.
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“They're gonna tell you to try to, don't worry about your burn rate, just grow, grow, grow, and I said, that's not in your best interest. They say that because you, they're the ones supplying the money, and eventually, if they need to, they'll do a cram down round, and basically take it, do it at a much lower price, and you'll have an opportunity to invest, But you've long exhausted your own funds to invest, and you'll lose control of your business.”
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