Today I wrote a guest post for TechCrunch called “Don’t “Pull A Patzer” And Other Lessons Learned On Our Trip Down Sand Hill Road.”
Here is the link: TechCrunch
The part of the article that seems to be generating the most amount of interest is the section titled the “Patzer Problem.” Essentially, this is the entrepreneur vs. VC problem of deciding when to sell a company, and highlights my surprise that VCs would actually say that they believe Mint.com’s sale was a mistake. I consider the company to be a huge success and this issue worth talking about.
In the comments, I note that…
I deeply share the concern “about any VC who says to you that any deal which puts tens of millions of dollars in a young founder’s pocket is something to avoid,” and that is why I wanted to shed light on the practice. I understand this phenomenon first hand, having been at Plaxo, a company that exited at $180M+ in equity value but had VCs saying it had failed behind closed doors.
My perspective is on this issue is that VCs are actually acting counter to their goals. They should tout these 3 year, $180M+ exits, and share the story with any budding entrepreneur who will listen — what better example is there of the incredible fruits of starting a successful company?
Furthermore, this exit in particular was at close to 40x revenue! It’s not like the company was a guaranteed success. Any rationale person would consider this a home run and I say congrats to Patzer and the entire Mint.com team.
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