How often founder get a profitable exit?
To fellow VC friends, Have been seeing people putting in their bio as successful Exit. How much returns do they get when an acquisition happens? What are the odds of making money.? I know a few who didn't even make any money.
VagueElbow
Stealth
9 months ago
Seed stage will make some decent money as their equity is higher. If its a million or two, take approx 50% of that as take home after tax (if only 1 funding round raised).
Series A and B level exits at that valuation are rare but can make founders decent cash.
Some deals are pure stock so founder makes money via decent stock and probably an insane hike in salary compared to what they were taking.
Example I used to take like 35k to 50k a month in my startup and just few months post my exit I am getting 1-1.5 cr base pay offers.
More than immediate cash if you exited to someone even for equity that's huge. Cos there are companies worth millions which didn't even get an acquihire and had to shut down. So acquisition of any kind is good. Money made by the founder depends on a lot of nuances.
Indusplateau
Stealth
9 months ago
Thanks for writing. It let's people know about possible paths that are open to.
Does power law exist even in acquisition in India?
VagueElbow
Stealth
9 months ago
I think so ya.
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Qwerty2398
Stealth
9 months ago
Almost all who rise funds from out side. They may not sell the company to profit. But they will exit profitably.
in very rare cases founder lose money from their pocket.
Successful exits are exception, not norms. Else everyone would be a founder
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