My company sold for $100M and I got zilch – how can that be?
This matters more now that the current crop of tech companies have taken <i>so much</i> money.<p>In the old days, when software companies sold software rather than traditional services enhanced by software, it was common to get to profitability around the B round and then never take any more investment after that.  Google took $25-35M and then nothing until IPO, running the company from 2001-2004 off cashflow.  Microsoft took nothing except a small mezzanine round (to align incentives with the I-bankers) right before IPO.  Github took a $50M Series A on a valuation of $500M; VCs owned 10% of the company, and the 3 founders + employees split the remaining 90% of its $7.5B acquisition.  Indeed took a Series A and is profitable.  Atlassian took a $60M Series A 8 years after starting the company, when it was already profitable.  PlentyOfFish, HotOrNot, Reddit, Wufoo all raised either nothing or just angel money before being acquired.<p>When you&#x27;re capital efficient, you get to keep the majority of any sale price.<p>The current crop of unicorns like Uber, Lyft, WeWork, Postmates, DoorDash, Instacart, AirBnB, and Stripe have all taken massive amounts of capital though, sometimes in the multi billions of dollars.  That has to be returned to the investors before the common shares (founders &amp; employees) make <i>anything</i>.  If they hit on hard times before a liquidity event, there&#x27;s a good chance that the common will be wiped out, and investors effectively own the company.  Why shouldn&#x27;t they, when they put up all the money that the company&#x27;s been burning?