{"id":11,"date":"2011-02-03T16:47:21","date_gmt":"2011-02-03T15:47:21","guid":{"rendered":"http:\/\/cerezo.name\/blog\/?p=11"},"modified":"2024-10-14T14:36:38","modified_gmt":"2024-10-14T12:36:38","slug":"richking-solving-the-founders-dilemma","status":"publish","type":"post","link":"http:\/\/cerezo.name\/blog\/2011\/02\/03\/richking-solving-the-founders-dilemma\/","title":{"rendered":"Rich<span class=\"amp\">&amp;<\/span>King: Solving the Founder\u2019s Dilemma"},"content":{"rendered":"<p style=\"text-align: justify;\">Every tech entrepreneur faces the same dilemma: raise as much as capital as needed to grow as fast as possible, while avoiding dilution. The tradeoff was quantified by Noam Wasserman in a study of 460 startups, showing that in general, refusing to release control only harms the business and the entrepreneur itself:<\/p>\n<h1 style=\"text-align: justify;\"><a href=\"http:\/\/founderresearch.blogspot.com\/2005\/11\/rich-versus-king-charts-and.html\" class=\"broken_link\"><img loading=\"lazy\" class=\"aligncenter size-full wp-image-122\" title=\"The Rich-vs-King Tradeoff\" src=\"http:\/\/cerezo.name\/blog\/wp-content\/uploads\/2011\/02\/F_value_v_F_control1.jpg\" alt=\"The Rich-vs-King Tradeoff\" width=\"580\" height=\"336\" srcset=\"http:\/\/cerezo.name\/blog\/wp-content\/uploads\/2011\/02\/F_value_v_F_control1.jpg 1023w, http:\/\/cerezo.name\/blog\/wp-content\/uploads\/2011\/02\/F_value_v_F_control1-300x174.jpg 300w\" sizes=\"(max-width: 580px) 100vw, 580px\"><\/a><\/h1>\n<p style=\"text-align: justify;\">Even so, entrepreneurs, hopeful creatures by nature, keep on searching whatever <a href=\"http:\/\/venturehacks.com\/\" target=\"_blank\" rel=\"noopener\">hack<\/a> that gives them an edge to reduce dilution. But the biggest hack is, and always will be, possessing perfect time-to-market skills, the entrepreneurial quality per se. <span id=\"xa6971a425a\">A<\/span>nd whilst founders usually manage to keep 5\u201315% shares after <span class=\"caps\">IPO<\/span>, some do much better, vg: Bill Gates(40.2%), Pierre Omidyar(30%) and Larry Ellison(27.5%). Another interesting case is Google, where founders keep control using Class B shares with super-voting rights (1\u2011to-10) to offset that each one only managed to keep 13.4% of the company, and Netscape, where Jim Clark kept 25.5% of the shares vs. 2.6% of Marc Andreessen (maybe it has something to do with Clark keeping only 3% after <span class=\"caps\">IPO<\/span> of Silicon Graphics, his previous startup).&nbsp; But it\u2019s outside the tech industry, where we find the quirkiest scheme to keep control, Kamprad\u2019s <a href=\"http:\/\/www.economist.com\/node\/6919139?story_id=6919139\" target=\"_blank\" rel=\"noopener\" class=\"broken_link\"><span class=\"caps\">IKEA<\/span><\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Every tech entrepreneur faces the same dilemma: raise as much as capital as needed to grow as fast as possible, while avoiding dilution. The tradeoff was quantified by Noam Wasserman in a study of 460 startups, showing that in general, refusing to release control only harms the business and the entrepreneur itself: Even so, entrepreneurs,&nbsp;[\u2026]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"wp_typography_post_enhancements_disabled":false,"ngg_post_thumbnail":0},"categories":[5],"tags":[],"_links":{"self":[{"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/posts\/11"}],"collection":[{"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/comments?post=11"}],"version-history":[{"count":12,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/posts\/11\/revisions"}],"predecessor-version":[{"id":1692,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/posts\/11\/revisions\/1692"}],"wp:attachment":[{"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/media?parent=11"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/categories?post=11"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cerezo.name\/blog\/wp-json\/wp\/v2\/tags?post=11"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}