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My instinct tells me that this is a much better outcome for founders and many employees than “unicorns”.

It’s possibly not as good an outcome for investors, and they might actually view this as a bad exit.

Am I wrong? Would most investors be pretty happy with this? Would most founders/employees be better of going for creating a unicorn?

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Given that Cluep is Canadian, I would expect the $500k they raised to be on a $2M Cap convertible note or some similarly valued instrument. That's totally a guess, btw. They could've sold way more or way less of their company. But, ballparking here.

So, ~20x return over 6 years for investors that are likely non-institutional. In short -- it's probably a very good deal for Angels. That's about a 65% YoY compounded return. It's likely that outside of the founders nobody is going to retire, but that's OK. It's only when deep institutional pockets get involved that <$100M exits are considered "weak."

For Angels but what about seed funding? YCombinator/Other incubators?

There's likely not much if any institutional money involved in a $500k raise.

If there was, then it's not as great of an outcome, but to an institutional investor this would likely just have been a "let's see what happens" check -- which makes it pretty good regardless.

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