1,108 karma · joined September 13, 2010
You can also get into this relationship with certain VCs.
I personally try not to hold it against my fellow white male entrepreneurs from prestigious schools and affluent backgrounds that I know we had an easier time raising capital and hiring people because of our race, gender, and social connections.
Answers include availability, lack of availability of healthier alternatives, targeted marketing, being missed by anti-smoking campaigns, and peer group influences.
While smoking may be a personal choice, it is not made in a vacuum.
Also even if you believe in Santa Claus and free markets, people getting on their soapbox to say “this is a terrible idea” is part of the free market.
If Sequoia is offering $10m at a $40m post money, how do you think that would change if they weren’t getting control and a guarantee they get paid first? Because without preference the founder incentive is a quick low risk liquidation at a price notably lower than $40m as soon as possible, because they’ve got 50% of the equity. This is another way in which financing valuations are an optimistic fiction.
Frankly I’m surprised the founder isn’t being more candid with you. Messing about and prolonging this stuff helps no one.
Similarly a generalist software engineer should know what things are realistic and possible with data mining and machine learning. Just like they should know what is possible and realistic in cpu design or network protocols. They might not know all the latest tricks but they will be able to design and advise on systems which depend on these capabilities.
As they say, "in the long run we are all dead."