I've heard this a few times. By what mechanism do the investors do the forcing, assuming that the company is early enough that the founder aligned board is still in the majority?
It's all a question of are the founders still in power or not. Especially at a time when the company is actively looking for a cheap last-resort acquisition, I'd expect all the possible external funding to have been pumped in, at less-than-ideal terms, and diluted the founders' slice.
I've personally worked at a startup that forcibly ejected its founders. It happens.
(The startup got sold for scraps about 6 months later. The service I personally worked on kept streaming video for about a year with zero maintenance, only failing when the hardware was physically powered off. This was well after the main database had collapsed, and the web UI was inoperable, while iframe embeds kept chugging along.)
> It's all a question of are the founders still in power or not.
Plenty of "founders" decide to sell out rather than follow their original vision no matter what. It's not even necessarily the wrong thing to do. But the prospect of a liquidity event can turn an idealist's head quickly.
I've personally worked at a startup that forcibly ejected its founders. It happens.
(The startup got sold for scraps about 6 months later. The service I personally worked on kept streaming video for about a year with zero maintenance, only failing when the hardware was physically powered off. This was well after the main database had collapsed, and the web UI was inoperable, while iframe embeds kept chugging along.)