Latka: Raising VC traps founders by blocking smaller lucrative acquisitions
Nathan Latka · Zoom Teleprompter For Sales People Hits $1k MRR in 30 Days After Spending $8k on MVP · Oct 31, 2021 · at 14:57
Host Nathan Latka cautions SmartQ founder Robin Singby about the structural risks of raising early venture capital at a high valuation instead of bootstrapping.
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“You're going to raise two million out of 10 pre. Whatever your buddies that you, but you take your buddy, your old boss's money, whatever. Great. Great for you. Then you're going to keep growing revenue and you're going to get a six million dollar acquisition offer and you still own 70% of the business. You'd love to take that deal because it makes you rich very quick. It gets blocked. You can't do that because you have to sell for at least a couple of times the valuation that the folks just put money in at. So now you're stuck on this like mousetrap where it's like IPO or bust. Your optionality is drastically decreased.”
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