Looks like an upround to me, but the question is what the liquidation preference was, and whether there was any money leftover for the common (I.E. employees)
You also need to keep in mind that this is an Atlanta-based company and not a Silicon Valley based one. The employees are likely to have worse contracts that what you'd find in the Bay Area, especially if the original and seed investors were local to the Atlanta region or Southeast. I know that term sheets from Raleigh-Durham investors are typically less favorable than out here in the Bay Area and I would expect the same in the Atlanta ecosystem.
In secondary funding markets, VCs have far more bargaining power. If you have real traction and are in those markets, you simply don't raise money there. You come out to the Bay Area instead where more VCs will compete to invest in you.
Sorry, I don't quite get it. Why are the employees screwed? I know that the VSs got liquidate first usually. But the employees also have their shares value raised in their pocket. If the contracts are not favorable, then even if they go IPO, it's the same for the employees, right? This is different from a new round of VC investment which may dilute the employees holdings.
"I know that the VSs got liquidate first usually."
That statement is accurate for secondary markets, but for the Bay Area, I'd say it's more accurate to say "I know that the VSs got liquidate first historically, but that's not necessarily the default today."
I'm saying that companies raising rounds in secondary markets like Atlanta and Raleigh typically get less favorable terms than those raising money in Silicon Valley. They have fewer VCs to choose from and the local VCs have term sheet expectations more similar to the term sheet expectations in the Bay Area from several years ago, which are far less favorable to term sheets today. I doubt that startups in secondary markets could even find investors willing to offer convertible notes or willing to budge on liquidation preferences.
Thank you for your information. Do you mean in Silicon Valley, VCs are rarely get preferred stocks from the startup company? But why are they offering convertible notes which to me is more risk for the startup companies than the VCs?
Look, I'm trying to understand what's happening and why. If you re-read what I wrote, I think you'll have a hard time finding any normative statements or any statements ascribing fault. I did use the term "dead end jobs" which is pejorative, but that's a term copied from the original article used as a reference not as a personal evaluation.
The only people I'm blaming for anything are the people writing these articles that leave out what I believe to be crucial and potentially explanatory information.
Any victim blaming you found into my comment was put there by you.
Another way of parsing the data, which is fully coherent with my prior point: society is making great progress, we're approaching the point where even our janitors are afforded the luxury of a college education.
You are using this phrase as if it would automatically mean that the people you refer to are not to blame, just because they are in a bad position. I disagree. I think that people need to take responsibility for their careers, and that frankly, if they end up in a dead-end job, it IS their fault.
Now, by saying this, I don't mean that we should settle for the status quo and that all is well. Just like with interfaces we should make systems that make it easy to choose right and hard to choose wrong.
In this case the victim is often responsible for making poor career choices.
The whole "I graduated, I'm entitled to a job" sentiment must go away, or we will end up with an army of hungry homeless history, women-study, art, philosophy graduates.
A generation or two ago you had a bunch of guys with degrees in literature and art-history managing plants full guys with highschool diplomas. And they all were middle-class or higher.
According to the BLS, the outlook for chemical engineers is only 4%, way below the average [1]. Other STEM fields, such as electrical engineering, are also in decline [2]. Software developers only increased by 19,000 jobs total. Students are graduating with the skills you list as desirable, but those skills aren't actually in demand.
Yes, I was referring to the second link there, based on the more recent data:
"The number of employed software developers, the largest IT occupation segment, increased by only 1.75%, to 1.1 million, a gain of 19,000. The unemployment rate for developers last year was 2.7%, which is still elevated, according to Hira."
Software developers are doing well, especially compared with some other STEM professions, it's just not huge in absolute terms because there's only about 1.1 million software developer jobs overall. Good for us programmers, but not for STEM careers in general.
Under your own link "Software developers, systems software" has THE best combination of the salary, projected number of jobs, and projected growth rate.
1) Give up and work for a shitty job, until it gets automated, then go homeless and hope the government keeps them alive
2) Learn new marketable skills and get a job. You're right, we can't all be programmers, but we can be nurses, car mechanics, accountants, pilots, welders, plumbers, farmers, etc.
3) Start a small business. Many successful small businesses are literally as stupid as "buy wholesale, sell retail". Many have very low barriers to entry, like making ice cream.
Your number 2 is silly and it makes it hard for me to take you seriously. If those are the jobs you think students should go towards, which exactly are the dead end jobs you speak of?
Well, there is "working on a farm", which is not paid well.
And then there's growing things and selling them, which is usually very profitable, and lands you all kinds of government subsidies, depending on where you are and what you're growing.
