Thursday, April 10, 2008

The Price That is Really Paid When a Start-up is Sold

I've written in the past about what I perceive as a disconnect between the liquidity events currently available to start-ups and the VC funding model. In a blog post today, Fred Wilson suggests that there is a need for a new path to liquidity. His argument is sure, people make money when big companies buy start-ups but that comes with a different type of price...
Except I am also a user of these services. I see what happens when a company gets purchased. The service languishes. The team leaves. It stops getting better. And often gets worse. And so even though I am happy to take the money, I am left wondering, frankly wishing, if there is a better way.
That is a very good point that I hadn't thought about.

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