PMD Deal — The Scoop
As some of you boys and girls know, my company recently negotiated its seed funding. I’ve had a few entrepeneurial endeavors before, but this current ditty is the first that’s had “traditional” VC participation - probably because I’ve been taking VC money on this project from day one! As a result, I’ve got a swanky office, plenty of support… and a dwindling equity interest in my company.
An additional perk is sharing an office space with the guys over at ProgrammerMeetDesigner, whom I’ve mentioned a few times before. Anyway, I finally got around to asking the PMD guys about the details of their own VC deal, and let me tell you, it’s pretty sweet. They wouldn’t let me share the term sheets here, but I can paint some broad strokes for you. First, they didn’t take a Series A, despite being fairly well established, but they still opted for a “seed” round. I’m still not exactly sure why, but I can tell you that they got $500,000 on a 5 Million post-revenue valuation.
Anyway, I think they are the classic example of a “bootstrapped” web 2.0 company with low costs, decent revenues, and a very slow burn rate. As a result, it looks like they will all get big pieces of the money pie when they eventually bow out and sell their company.
