David Rosenthal: evaluation

Transcript context

…Pretty amazing. I mean, I wonder, the first thing that comes to mind is did the founders keep all their shares, was there a little bit of secondary there where they took money off the table. They had have taken something, right? I don't know for sure but they may not have. There had been some secondaries along the way. So I believe some of the money from some of the later rounds was secondary sales that the founders and management team were taking money off the table. So I actually don’t know in this case whether Nestle paid out anything to any of the employees. Well, I will say, you know, as I for lots and lots of reasons believe that full acquisitions are better than these sort of majority buyouts, particularly for startups like this, I mean they’re 40-store retail location, but early-ish mid-stage company. But if you're going to do it in this manner where you're not acquiring the entire company, I love the idea of it running independently and the founders still having a ton of skin in the game to make this thing grow in valuation. There’s sort of an interesting thing of like it has to stay a separate company. Think about this. How if you're those founders do you think about how your shares get valued now? Like there’s not really a competitive market to do the next round. Like there’s not a market to value your company. And it’s certainly not anywhere near getting valued on a reasonable sort of price to earnings ratio. So are you hoping that at some point Nestle just decides to buy you out? Is it actually in their best interest to do that? I love the incentive. I’m curious on the mechanics of how that works.…

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