Comment by gk1
16 hours ago
You almost don't have to snoop for details to have a good guess at what happened. If the acquisition announcement is the first time in a year or more that you're hearing from this company and they omit the sales price, you can bet this isn't the exit most parties wished for. Although by this stage the founder(s) is probably happy to find a buyer who will retain their team.
> you can bet this isn't the exit most parties wished for. Although by this stage the founder(s) is probably happy to find a buyer who will retain their team.
I've seen a startup that was bootstrapped 10 years ago but took on too much money and ended up getting acquired for "undisclosed sum" but at the same time everybody knew the investors were just recouping their money while founders got nothing (they had sold their equity for raising more money as their costs were way up but nobody was buying their product). Cue local news reporters don't know the nuances so they'll just announce "Startup X acquired by Y, wow!"
Founders place a lot of emphasis on getting "acquired" but there is roughly 95% chance of you selling at breakeven where the terms leave you with a year's worth of salary as a junior SWE
Get ready to see a lot more of these "acquired" news coming out in the near future. something around less than 1% chance of getting more money than you put in.
Startup has horrible odds especially if you are building a simple GPT wrappers
What’s interesting is how much it contrasts with TechCrunch’s story: ‘Most of Command AI’s 30-person, San Francisco-based team will be joining Amplitude. Command AI’s co-founder and CEO James Evans wouldn’t reveal the terms of the deal, but said candidly that an acquisition wasn’t something he’d been planning on. “Our growth was great and we had plenty of runway,” Evans told TechCrunch. “We weren’t out shopping ourselves or anything. But when Amplitude reached out a little while ago — this summer — we got really excited about the combination and became convinced that we could grow faster and reach more users together.”’
People want to save face. Some more than others. I also read the TC article and thought they were trying a bit too hard to make this seem like a good outcome.
Nothing against the founder. It's just how the game is played. And there's little to gain from deviating from the norms.
Edit: It benefits not just the founder’s ego but also the future career prospects of the employees. Big difference in your engineers being able to say “I worked at X all the way until they got acquired!!” and “I worked at X but the product was so unsuccessful we had to have a fire sale.”
That's too bad that the TC article read that way. They returned more money to investors than what was put in, which puts them in the top ~20% for acquisitions of this scale. The crazy part is even a lot of the 1B+ privates aren't able to do that (eg Lacework)
I both think this comment is spot on (acquisition theater / cope-core is very real) and what I said was true :)
Obviously, the better financial outcome is to grow huge independently and go public, etc, but there are a lot of good outcomes that are not that.