alright give me the scoop, what is the catch for companies that receive money for start-ups? Something doesn't seem right to me about Y Combinator
Read the wiki, they get 7% equity.
>>61483829
no its gotta be more than that. I don't mean in actual value, but something more.
Depends on the company. Some basically become taken over by reps for the VCs and spun into something which is meant to be gobbled up by Alphabet or Verizon or something. Founders get a healthy cut of the profit and everyone parts ways in 1-3 years.
For others, there is no catch. Investors are willing to lose their shirts, so to speak, 80-90% of the time with the hope of eventually catching a unicorn. They'll lock in preferred shares for themselves and make demands of the executives regarding monetization of the product, of course, but for them it's just a roll of the dice. A few million here and there with the hope that one will become the next Dropbox.