Comments - I Only Care About Terminal Value
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I Only Care About Terminal Value
Prefix's seed round, Slop Con NYC, LLM-client privilege Read →
5 Comments
This might be a sort of loser premise (lol!) but I wonder if TV really is the north star in industries with massive and growing incumbents. Would it not make more sense from a returns perspective to juice revenue with a focus on the midterm and just push to be acquired, before the idea of TV ever comes into play?
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loser mentality. couldn't have put it better myself lol
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Appreciate the response and am a big fan of your writing, thanks!
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serious answer: you're totally right but what you're describing is a trade not an investment. for a fairly fixed term annuity you either need cash flows along the way (totally valid - lots of hybrid models emerging to fund this) or some pretty high certainty of a single liquidity event before the value goes to zero. if you're forced to hold and the biz can't generate cash, it's basically a greater fool theory of investing
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Okay yeah that makes sense to me. Is there not maybe an alternative though where the acquirer isn't a greater fool but is instead just optimizing for time considering price isn't a massive constraint? Manus acquisition as an example - it would be hard to argue they had clear TV, but I'm sure founders are happy w the outcome
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