

42Floors (YC W12) Announces $5 Million Series A… Sorta - jaf12duke
http://pandodaily.com/2012/09/10/y-combinator-alum-42floors-announces-5-million-series-a-sorta/

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philipDS
"I reached out to co-founder Jason Freedman who said that the company is not
ready to disclose additional details about the funding round. That being the
case, he (or likely an underling) would have been better off not posting it on
the the tech world’s version of the water cooler."

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Well.. I think adding the "(unannounced) Series A" to a job posting wasn't
that stupid after all. On the contrary, they just got free coverage from
PandoDaily. Probably when they officially announce their Series A in a few
weeks they'll get press again. Jason Freedman is a pretty smart guy and I've
been following his (old) blog (humbledMBA) for a long time. I would be very
surprised if this was mistakenly added to the job posting. :)

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jaf12duke
Thanks Phillip--appreciate the nice words. I wish it was more calculated than
it was. We've been mum about our financing because, well, it's just not
necessary to talk about it yet. We like to talk about financing only in
conjunction with product launches. That's why we're here anyways--to make
something people want--the funding is just one part of that goal.

However, a big part of recruiting is showing some likelihood of having a big
impact on the world and cash in the bank can often play a large role in a
prospective employee's mind. So, we released our amount but not the investors
(I had promised TechCrunch that I would call them first with investor names).
A similar comment had been on our jobs page for months already with no one
writing about it.

I was hoping that the lack of investor names would hold off a story for now.

PandoDaily contacted me almost instantly. I told them I'd prefer to wait on a
story, but I fully understood their right and obligation to publish. The guys
at PandoDaily are first class. I'll continue to work with them on future
stories because they're good journalists that still took the time to talk
through the situation with me.

Either way, it's out. Back to work...

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nostromo
Story submitted (and tweeted) by a 42Floors co-founder? The plot thickens...

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jaf12duke
No real plot. Once the story has been written and published, we certainly want
it read by the largest possible audience.

As an aside, I also sent a copy to my mom. I had to explain very clearly that
this doesn't mean _I_ get $5M. Oh Mom...

~~~
joshu
There should be a FAQ for parents of founders.

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stefanobernardi
When I read (unannounced) in the job posting, I was just counting the
minutes..

Curious to know if this was intentional, but probably isn't as you can pretty
much get anyone to cover a $5M Series A on your terms..

~~~
jaf12duke
The real question is, will it affect our recruiting effort. If we find someone
to join up that tells me they found out about us because of the story, I'll
call it 100% successful.

~~~
stephenhuey
Here's hoping they flock to TheSquareFoot instead! I'm a bit biased towards
the H-town startup, but perhaps the real estate market is large enough that I
can just root for both of you. :)

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jaf12duke
Totally. We root for them all the time. Startups should always root for other
startups. Why the hell not? We're not going to lose to each other (most
likely). It's the back button and ineptitude that always does startups in. So,
while we both have a fighting shot, I'll support them in every way I can.

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wilfra
From the job posting:

"Salary is $100k+ (you'll pick the actual number)"

Is this a 'can you think like a founder' test?

~~~
jaf12duke
No not all. The original founders all have sub-$100k salaries but also have
more than 1% equity.

I don't like having salary negotiations with people that could work anywhere
or could start their own company. I'm humbled and honored by their decision to
work with us (that decision always comes before we talk salary).

I show them the cap table, the bank accounts, and everyone else's salary in
our company...and then ask them where they would like to be.

We can't do it this way forever, but for now, it means that everyone in the
company feels good about where they stand. In talking to my other startup
friends, our salaries are very similar to their's, so it doesn't seem to make
much of a difference in the outcome.

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anmol
Showing them "everyone else's salary in our company" is a pretty strong
approach. How well has this worked out? Curious.

(Note: founders should still keep total comp #s fair for everyone, but there's
a difference between that and _revealing_ everyone's salary)

~~~
jaf12duke
It's not the normal way, but it's worked out just fine for us. We've all run
our own startups before and we've all been burned before in one way or
another. Building trust with each other is paramount.

Right now is one of the toughest talent wars I've ever seen. We've brought
together 9 people all capable of running their own companies--you can't do
that by doing everything the normal way.

But aside from all that, it just feels right to us.

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adgar
"At this stage, 42Floors only serves the Bay Area, but Freedman tells me that
the New York City launch is just over month out, likely followed by other
technology hubs around the world like Cambridge, Boston, and Seattle."

Funny definition of world. Regardless, congratulations!

~~~
cfontes
If you guys ever think about são paulo I would love to help.

~~~
jaf12duke
Oh man. Can't wait.

