[logicallee]

I just meant to show the probabilities. (Such a bond wouldn't have to pay for non-winning tickets.)

Whole scenario is totally unrealistic. (Though if I parked $100M in cash at a bank I would not be surprised if it offered me a AAA bond @ 12% for, say, $500K. This will cost them $60K per year or 0.06% of this totally unrealistic principal. Maybe they'd do this to mollify me, I don't know. Point is, if my target is 10% returns then I should accept!)

What the bonds stand for is tptacek's business, which " has a Y2 ARR(!) and revenue target that I think would make a lot of YC companies pretty happy" but is "not a sensible investment for venture capitalists".

[tptacek]

You're saying we could do a debt financing to expand the business. Yes, we could do that. We wouldn't, because debt sucks, but I agree it's an option that is available to us, where venture funding is (I think, and am fine with) not.

[logicallee]

>where venture funding is (I think, and am fine with) not

well yeah, if someone doesn't want venture funding no VC is going to beat down their door and make them re-do their business plan so they can take an equity investment :)

what I said applies more to companies that do want or need venture capital for their plans. These startups are not getting enough first financing checks.