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by nostrademons 4561 days ago
The other way to correct for this problem is founder cash-outs, which require some negotiating leverage but solve it even more elegantly. Rather than saying "We're worried that you'll take a small exit that would be great for you but a disaster for us", they say "we'll pay out that small exit we're worried you'll take, because you're being offered it anyway, and now you have the same incentives we do to shoot for the fences because you're already independently wealthy." It aligns incentives almost totally, and is viewed as a benefit rather than a restriction by everyone involved.