[nicholassmith]

Unfortunately it seems like a lot of the time people are building companies for exits, rather than long term products. There's exceptions of course, but how much of that is now the expectation that to get the funding to do something you've got to be aiming for $xm dollars at exit.

I've got no problems with people exiting like that, but it makes me wonder where all the pressure to sell up and move on comes from.

[hnriot]

This might be a good strategy - the skill set required to get a company off the group is very different from long term growth and sustainability. By exiting, the skills are compartmentalized. I worked for a company that made networking products, at the time they were ahead of Cisco's tech, but Cisco had by far better penetration into the CIO world. The sales cycle was too long for a small startup and we practically ran out of money just waiting for companies to evaluate our product. It was clear that the company would do far better inside an existing sales infrastructure, so we exited and moved on to things we did best.

Not building a company for the long haul isn't necessarily a bad thing, provided the business itself has the ability to grow elsewhere.

[grey-area]

I've got no problems with people exiting like that, but it makes me wonder where all the pressure to sell up and move on comes from.

The pressure often comes from the VCs who put a lot of money down in an initial investment, and need at least some of their bets to pay off within a short time-frame. Are there any long-term VC funds which accept stock and then wait for dividends?

[patmcguire]

It's generally too easy to game dividends - you can do lots of Hollywood accounting to make money without ever "making money."

Companies also aren't obligated to pay a dividend even if they're profitable - see Apple up until about a year ago.

[nicholassmith]

I'm not sure, I can see it from the VC point of wanting to return on investment as fast as possible. It does seem like it creates an industry based on ship it, sell it.