The following is my answer to a Quora question: “Should startups
‘hire’ a founding investor?”
The question conflates
three things: founder, investor and employee.
Founders are the owners of the business.
Their interest is to grow the startup and enhance its market
capitalisation. Investors put in money
into the business to extract value from it through cash cow or various forms of
exit. An employee is paid to perform a
specific job so that the startup can generate revenue in excess of the cost of
hiring him. What is a “founding”
investor? This sounds like an oxymoron.
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