Airbnb CEO shares VC rejection emails from 2008


#1

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#2

For context, courtesy Wikipedia:

As of March 2015, Airbnb is raising a new round of funding that will place the company at a $20 billion valuation.


#3

If you’d invested in 2008, you would have had 10% of Airbnb as it was in 2008. That doesn’t mean you’d have 10% of the company now, unless you put in a lot more money, as later funding rounds would dilute your holding.


#4

Not necessarily, at least according to Wikipedia

Many venture capital contracts contain an anti-dilution provision in favor of the original investors, to protect their equity investments.


#5

Clearly his pitches didn’t include “disruption” enough.


#6

The anti-dilution provisions generally mean “if you own 10% of the company, any further rounds have to give you the right to buy 10% of the new shares”. From the same wikipedia page:

They can choose to put more money in the company, or else lose ownership percentage.

This follows with what drplotka said:

That doesn’t mean you’d have 10% of the company now, unless you put in a lot more money…


#7

The same VC firms should post the stacks of letters to startups that never made it.


#8

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