I think this is my favorite comment of the year. We've all become so inured to the idea, especially in startup land, that the purpose of building a business is just the exit (and hopefully we can get out soon enough with someone else "holding the bag").

As you point out, if Figma can build a growing, profitable business, there is no reason they can't IPO at some point. But still, this shows how even the purpose of an IPO these days is completely opposite from the original intention. I.e. the original intention was to get access to public market funds to grow a business. Now it's usually just a method of "exit" to let retail investors take the lion's share of the risk - one only need to look at 95%+ of the past few years' SPAC deals to see how much of a "pump and dump" the market has become.

There is nothing wrong with that if that is the type of company you build from the start. VC funded startups generally want to have an exit/IPO to get a return for their investors and give their founders and employees an opportunity to cash out and de-risk. Without an exit or IPO that is a lot harder, especially for employees.

It's about the expectation of everyone involved.

Eventually every company needs to turn a profit, so for the company it might not make that big of a difference or even be better (if they can turn a profit which I assume Figma can), but for the investors and individuals involved it's a very different situation as it means their capital is pretty much stuck. And I bet a $20B exit would be life changing money for a lot of people involved.

I think the issue is that when you buy up your competition there’s nothing stopping you from charging obscene prices in either direction. Charge low to wipe out potential competitors then high when there’s no one left. It very clearly stifles innovation and god knows we don’t regulate monopolies anymore.

The employees are sold shares in the business that they expect to accrue a certain amount of value and with scale get very serious multiples in a liquidity event. With that promise broken the value proposition they originally signed up for no longer holds, some perhaps wasted the best years of their lives here when other options were on the table. If all you want to do is sell goods and services for more than they cost, then open up a bakery.

Sanity prevails, at least in some HN comments; this is why I come to HN :)

Yes, thank you…

I could even prune that down some more. What's wrong with selling goods and services?

Not as a means to the accumulation of enough wealth to cash out and cease selling goods and services, which is what the startup world is trained to do. There's this hyper-focus on financialization, in that nothing means anything beyond the eventual payout, and all things are designed to either succeed or fail at going public and delivering that jackpot.

What about… doing the thing? Making a good, doing a service? What if that thing is in itself a thing to do, a purpose to have? In that case if you are either breaking even and retaining control, or amortizing the cost against something else, then you're pursuing some kind of idea that is not itself 'money'.

Why not that? Why not, directly, a thing that isn't money? I'm given to understand the idea of money is to accumulate the power and resources to do whatever thing your dream envisions. Well, how about cut out the middlemoney and do the thing?

Well, if you're an employee joining because the stated path is to find a successful exit vs build a sustainable business, your comp expectations may have reflected that and been lower than normal.

Careful now, you'll give someone an aneurism with talk like that, dontchaknow?

On a serious note, it's depressing how much a comment like this stands out from the crowd.

Owning just one company that does that has a much worse risk profile than owning a little bit of many companies that do that. That's why founders, angel investors and employees want to sell their share of the company to a huge fund and then invest their money back in that fund.

Unfortunately taking investment means you are accountable to their interests, not just your own. This includes the employees whose investment was opportunity cost.

It’s hard work!

Much easier to give things away for free and sell the company.

It doesn't make anyone rich quickly.

Nothing.

Unless you are VC-funded. Because VCs expect+need an exit for their LPs.

What are you replying to?

edit: Got it. I just woke up when I asked.