Inside Versus Outside Financings: The Nightclub Effect

At some point in the life of a venture-backed startup there typically arises a choice between doing an inside round, where the existing investors lead the new financing, or an outside round, where new investors lead the new financing. At this point interesting game-theoretic dynamics arise among management, existing investors, and prospective new investors.

 

(Full Post: http://cdixon.org/2010/06/08/inside-versus-outside-financings-the-nightclub-effect/


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Chris Dixon

Chris Dixon is an investor at Andreessen Horowitz. He was previously the Co-Founder/CEO of Hunch, Co-Founder of Founder Collective, and Co-Founder/CEO of SiteAdvisor.

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Filed Under:
Collection: Funding
Category: Choosing Investors