Evan H Fisher’s Post

Greed & stupidity lost him a $10M Series A. It’s not even that my “cofounder” was green, it’s that he was a control freak & was deathly afraid of going below 70% shares. (Needless to say, he didn’t understand multiple share classes) So I had joined this company - long time ago - as a cofounder CFO. B/c no one had any idea how to put together a financial model, let alone explain it to potential investors. In MY stupidity, I didn’t get my shares in writing. Verbal promises, all kinda shifty. Hey, I was young. Mistakes were made. But we had settled on 10%. After all, I was coming in a bit later on, all the $ had come from his side, & my part wasn’t supposed to be that involved. A few models, keep the books, do a few investor calls etc Fast forward to the part where I’m literally lying to my boss that I’m sick & can’t come to work… when in fact I’m on literally another continent doing business deals. I ended up doing EVERYTHING: Legal agreements Financials Models Decks Investor outreach Fundraising Ops You name it. I was running the show. And got the business to the point that we negotiated an unbelievably sweetheart $10M series A, from a PUBLICLY LISTED gold star investor. It was an incredible deal, negotiated down to “please sign on dotted line” The money was waiting. But here’s the thing: my majority-owner cofounder wanted ME to sign on the dotted line. Not him. Meaning it’s ME. MY reputation on the line with a public company on the other side. Not something I was willing to do, especially considering my shares HAD NOT BEEN ISSUED YET. I owned exactly 0% at the time! Considering my massive contribution to the company, I asked for more. 15% seemed reasonable- I was doing everything, no exaggeration. He balked. Hemmed and hawed. He wouldn’t tell me why, or give me anything definitive. But my shares were not getting issued. At the same time, I had to leave my day job & needed a new income… but this “project” was taking up 30 hrs / week for me. And paying me nothing. I explained my concerns and we went around in circles for a week. $ running out, time running out… Series A counterparty patience running out… I gave him the choice: either the business issues my shares & pays me salary so I can justify focusing on it, or I need to seek other gainful activity. More hemming and hawing. More going around in circles. I had mouths to feed & a roof to put over their head, so it was hard decision time. I pulled the plug. Exited as quietly as I could. Just backed away slowly. …months later, the chairman of the potential investor called me. (We had become friends while putting together the potential series A) “When I found out you moved on, we had to rescind the termsheet. Clearly you were the one running the show - the other guy just couldn’t execute.” Ouch. Not what I wanted for the business, but such is life. Moral of the story? Greed kills progress. There’s always another way. I don’t feel bad at all.