(2019-11-20) Dhh We Need Counter Capital

DHH: We need counter capital. Why isn’t there a market for selling a minority stake of your profitable tech company to people who’d be happy to be paid back in distributions and dividends, rather than capital gains? It seems like a glaring gap in the market.

At the low end, raising a few hundred thousand dollars to take a business from “a struggling side project” to “profitable, sustainable full-time business”, there are now a bunch of options. Basecamp has put money into Tiny Seed, indie.vc, and Earnest Capital, to support the idea of alternative funding that doesn’t require those damn rocket-ship trajectories to make sense. But those options don’t really do much for a business that’s already become profitable. The whole point of those funds is to get a company to that point.

if we had that, if we could save more companies from getting sucked into the venture capital roulette

Imagine a Meetup that didn’t need to sell itself to WeWork because turning a basic profit was good enough. Or a Patreon that wouldn’t scoff at taking a 5% cut of hundreds of millions in donations, because it would be enough.

There’s got to be a way to make this work.

What a lovely project this would be for a billionaire to kick off. Jeff, you still there?