Startup Follies Part II
We had venture capitalists promise us a small amount of seed capital - in the low 6 figures. Terms were half up front, and the second half once we had our first sale of US$50,000 or greater.
Once we had a signed deal for over US$50,000 they promptly told us they were bankrupt and going out of business. Now clearly they knew ahead of time and their behavior was unethical!
As soon as they knew they would not be able to fulfill their commitment to us they should have told us. We would have spent money differently if we knew more wasn't forthcoming.
At this point we should have ditched these unethical venture dudes - they sucked! Legally speaking, they were in default.
However, the four principals in the company disagreed. They might have screwed us by hiding their pending insolvency, but they were well connected, they knew important people, they might be useful in the future, blah blah blah. They kept taking advice (and demands) from these unethical venture capitalists.
I should have quit at that point, but unfortunately didn't!
Once we had a signed deal for over US$50,000 they promptly told us they were bankrupt and going out of business. Now clearly they knew ahead of time and their behavior was unethical!
As soon as they knew they would not be able to fulfill their commitment to us they should have told us. We would have spent money differently if we knew more wasn't forthcoming.
At this point we should have ditched these unethical venture dudes - they sucked! Legally speaking, they were in default.
However, the four principals in the company disagreed. They might have screwed us by hiding their pending insolvency, but they were well connected, they knew important people, they might be useful in the future, blah blah blah. They kept taking advice (and demands) from these unethical venture capitalists.
I should have quit at that point, but unfortunately didn't!
posted by Ted Demopoulos at 10:01 AM
Comments on "Startup Follies Part II"
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The Sarge said ... (Wednesday, June 08, 2005 1:59:00 PM) :
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Bruce Allen said ... (Wednesday, June 08, 2005 4:50:00 PM) :
post a commentI'm a Ted and I'm Cypriot. Coincidence? Yeah probably. Keep up the Ted Rap and start reading my site:
http://charleypatton.blogspot.com/
Ἀγεωμέτρητος μηδεὶς εἰσίτω
Ageōmetrētos mēdeis eisitō.
Hey Ted, just stumbled across your blog, a fellow NH native here, and I worked over in Durham at UNH for a number of years. I'll be checking back in interest.