{"id":371,"date":"2017-08-10T02:27:33","date_gmt":"2017-08-10T02:27:33","guid":{"rendered":"https:\/\/www.ashwinl.com\/ideas\/why-we-said-no-to-a-40m-round-hacker-news\/"},"modified":"2017-08-10T02:27:33","modified_gmt":"2017-08-10T02:27:33","slug":"why-we-said-no-to-a-40m-round-hacker-news","status":"publish","type":"post","link":"https:\/\/www.ashwinl.com\/ideas\/why-we-said-no-to-a-40m-round-hacker-news\/","title":{"rendered":"Why We Said \u201cNo\u201d to a $40M Round | Hacker News"},"content":{"rendered":"

Why We Said \u201cNo\u201d to a $40M Round | Hacker News<\/a><\/p>\n

\n

\/sarcasm<\/p>\n

Modern guidelines for valuing a tech company in an M&A:<\/p>\n

– The technology asset is worth $3-5M, no matter what it is.<\/p>\n

– Higher AWS bill = better product.<\/p>\n

– EBITDA is not important, you can ignore that.<\/p>\n

– What’s the QoQ revenue growth for the last 8 quarters? Doesn’t matter if margins are going down. Only revenue growth matters.<\/p>\n

– More employees = better company. Obviously.<\/p>\n

– Valuation should be directly proportional to venture capital raised.<\/p>\n

– You have a remote engineering team in the US? Why not go offshore or nearshore?<\/p>\n

– Make sure it’s an asset deal, not a stock deal, so that you can write it off but the founders get double-taxed.<\/p>\n

– Design earnouts such that they are unachievable.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Why We Said \u201cNo\u201d to a $40M Round | Hacker News \/sarcasm Modern guidelines for valuing a tech company in an M&A: – The technology asset is worth $3-5M, no matter what it is. – Higher AWS bill = better product. – EBITDA is not important, you can ignore that. – What’s the QoQ revenue […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"link","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-371","post","type-post","status-publish","format-link","hentry","category-uncategorized","post_format-post-format-link"],"_links":{"self":[{"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/posts\/371","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/comments?post=371"}],"version-history":[{"count":0,"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/posts\/371\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/media?parent=371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/categories?post=371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ashwinl.com\/ideas\/wp-json\/wp\/v2\/tags?post=371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}