"People familiar with Gorillas’ finances said […] It had been losing an average of €1.50 for every €1 it generated in net revenue […]" (source: FT)
🤯
This is not entrepreneurial. This is/was riding a wave of FOMO and cheap money.
If anything, this is a distribution of capital from the rich to the middle-class. Kind of a socialist idea - for the ones who have enough and more than enough 🤪
The lower incomes can't afford these services: They work for them - for minimal wage.
It even looks like the founders won't see much return on their investment of money, time and energy. The valuation was slashed. If anything, they will have an earn-out and maybe see something at the end.
But valued $1.2bn and paying out "only" $40mn to investors, sound like appeasing them with pain-killers so they agree to an equity swap. The alternative was to let Gorillas go bust, or shovel more money in to the incinerator.
So from a founders point of view: Why would you go through this pain? Sure, it looked all easy at first. But the co-founder was a consultant. I'm sure he knows how to make a profit.
At this rate, running a small business profitably, is much more attractive. No hassle with investors, keep it small and tidy. Pay salaries and take home a profit for years to come... 🤷♂️
On that note:
Uber Technologies might reach break-even next year … provided they grow +52% year-on-year until March '23. Wow! Not.
Uber raised more than $25 billion in funding and is still burning money ... 🤯
Now that's a transfer of wealth. US-/VC-made socialism for the world 😅
🤯
This is not entrepreneurial. This is/was riding a wave of FOMO and cheap money.
If anything, this is a distribution of capital from the rich to the middle-class. Kind of a socialist idea - for the ones who have enough and more than enough 🤪
The lower incomes can't afford these services: They work for them - for minimal wage.
It even looks like the founders won't see much return on their investment of money, time and energy. The valuation was slashed. If anything, they will have an earn-out and maybe see something at the end.
But valued $1.2bn and paying out "only" $40mn to investors, sound like appeasing them with pain-killers so they agree to an equity swap. The alternative was to let Gorillas go bust, or shovel more money in to the incinerator.
So from a founders point of view: Why would you go through this pain? Sure, it looked all easy at first. But the co-founder was a consultant. I'm sure he knows how to make a profit.
At this rate, running a small business profitably, is much more attractive. No hassle with investors, keep it small and tidy. Pay salaries and take home a profit for years to come... 🤷♂️
On that note:
Uber Technologies might reach break-even next year … provided they grow +52% year-on-year until March '23. Wow! Not.
Uber raised more than $25 billion in funding and is still burning money ... 🤯
Now that's a transfer of wealth. US-/VC-made socialism for the world 😅