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Comment by Talyen42 | Hacker News Reader

Classic case of a superstar at X (video, editing) trying a new sport Y (startup management), and failing spectacularly.

Casey Neistat is a talented daily lifestyle vlogger, and apparently not a talented venture startup video platform CEO.

hmm. He did sold the company for millions of dollars to CNN. Should have made more money than most "venture startup video platform CEO"s in their lifetime.

How much of that is a result of success as the former, and not the later?

There are plenty of startups started by celebrities which burned a lot of money and died. Of course, the popularity of Casey must be a factor for the CNN acquisition but you can't tell that as the only one.

The company took multiple rounds of VC money and sold to CNN for ~$20 million. He very likely didn't make a penny from the sale.

Somewhat irrelevant though, as he takes home annual-salary-sized checks for every video that he puts on youtube.

Raised $2 million in 1 round and sold out for $25 million.

Raised $6+ million in 2 rounds.

Could you possibly elaborate on how the breakdown of an exit like Beme's (prior to CNN) could have resulted in Casey not taking much?

I thought Beme was dumb, just curious to learn more about the mechanics of this kind of deal.

Not OP and I have no inside info, but if we take the $25m as given and assume that investors owned 20-30% on a $2m check with a vanilla preferred that brings the founders/team share down to somewhere in the the $17.5-20m range with the lion's share going to the founders.

Sounds nice, right?!

But, and this is admittedly a big assumption, this smelt like an acquihire at the time so I imagine the deal was structured in a way that allowed the financial investors to cash out with a respectable return while the founders committed to some form of earn-out to ensure their commitment and loyalty to making the platform a success for CNN. Given how quickly the shutdown occurred, you have to assume they didn't meet the metrics in the buy-out so will be leaving some (a lot?) of that purchase price on the table. If we assume a 50% discount that brings the net price down to under $10m split across a group of 10+ employees with the two founders presumably capturing about 80% of that. After tax ~ possibly at their prevailing income tax rate vs long-term capital gains ~ he may have realized a low-single digit million exit which is nothing to sneeze at for the vast majority of us especially given the quick turnaround. Now, if CNN negotiated hard on the earn-out or the investors had something other than 1x preferred it's possible that number is significantly lower, but none of us really know.

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