Secondhand Clothing Marketplace Twice Is Putting Up $1M To Acquire YC Companies

[noaharc]

Hey everyone, I'm the co-founder of Twice. Just wanted to add my 2 cents too.

- @jboggan, agreed. YC knows how to pick em.

- We're only planning on one acquisition for now.

- Yep, it's a mix of cash and equity -- we haven't quite finalized all the details -- and everything will vest (as is standard), but you'll at least be able to buy a car on day one.

- The equity is valued based on our Series A valuation, which, unfortunately, was substantially less than $100 trillion :-)

- It's definitely an expensive proposition for us, but awesome people make awesome companies, so we think it's worth it.

More at restartfund.com. Feel free to shoot me an email as well ([email protected])

[jboggan]

I can't remember who wrote this, but someone recently was blogging about YCombinator being the future of the educational and credentialing system. Stories like this make me believe the author's premise.

[rayiner]

How so? YC plays in an industry (internet tech startups) that never cared much about education and credentialing to begin with.

[aresant]

Brilliant, brilliant PR that's knocking every corner of the internet.

But the pitch feels a bit dishonest given that the $1m will be "a mixture of cash and equity"

A mixture could mean a $10k signing bonus and $990k in stock. And then what type of stock. And then at what valuation. etc.

But still, got to respect the hustle in that pitch.

[gojomo]

Hmm, let's say they pay YC their liquidation preference, pay Milner's note, and give the team a small signing bonus and new salaries for the new mission.

Twice could probably do up to 5 such acqui-hires with $1M cash. It fits nicely with their second-hand clothing theme, while ensuring some consideration from any YC team on the verge of liquidating their existing organization.

[netmau5]

I'm incredibly curious about how the Twice investors feel about this allocation of capital.

[twelvedigits]

Investment capital is typically used to hire people, so why does it matter how they go about doing it?

[Julianhearn]

Don't yc companies have only a few team members, say three. That $333,333 per team member. Seems like more money than sense. a good argument not to give startups much money until they have a profitable business model and just need money to scale.

[mattmaroon]

If I'm reading this correctly, it's $1m they're putting up to acquire "teams", not "a team". My guess is each team will get much less, which makes me question the usefulness.

[retroafroman]

Being that the $1M is a mixture of cash and stock, they're not likely to actually get that much cash per person. In fact, I'm betting it's much less. Also, who knows if what they intend on paying the founders/new employees after they start working. Perhaps they'll offer a minimal salary, meaning that it all balances out in the end. Despite this eye catching headline, there's still a lot of unknowns that could make it a not very sweet deal.

[itry]

They dont say how much real money they put on the table. They say "$1MM in cash and equity". Its a marketing ploy. And it worked. They got a catchy TC headline for free.

[arbuge]

Desperate times call for desperate measures...

...is the Valley still a good place to launch given the enormous expense of talent there these days? Raise money there but hire remotely now seems like a better formula.

[Codhisattva]

So who's the product now?

[sriramk]

Aren't these the Minno guys from Randall Stross's book? Didn't know they had pivoted.

[noaharc]

Yep! Restart Fund is actually partially a product of our pivot. We basically weren't getting anywhere with micropayments, and we weren't sure where to go next. We got approached by a few big companies about talent acquisitions, but we knew we really wanted to be working on something early-stage with a lot of opportunity for growth. So hopefully if anyone else is in a similar position, Restart Fund could be another option to consider.