LinkedIn·Wednesday, 12 August 2026·14d ago

The Good, the Bad and the Ugly Here’s the bonus Did I make a ton of money? No. Unfortunately I did not succeed in elevating the project to…

Nicolas Debray

Board Director | Advisor | Business Angel Investor | Entrepreneur | ex-Google

The Good, the Bad and the Ugly Here’s the bonus Did I make a ton of money? No. Unfortunately I did not succeed in elevating the project to another level. A few extra learnings worth sharing though. Remember, first, when I entered the deal, the shareholders wanted an extremely high pre-money valuation. The then-current shareholders initially pushed for a 4M€+ pre-money valuation for a 10-20k€ MRR startup. After weeks of meetings and calls, we reached a compromise: a 3.2M€ pre-money valuation for 800k€ of fresh capital and ... a liqpref(check the first episode [1/4]). An important safeguard that proved key for investors years later was that liquidity preference negotiated. When we sold the company, I knew based on the valuation that I would recoup my initial investments. As a business angel, I accepted fewer shares with a high valuation but protected my downside with a liqpref. For the founders, however, the outcome wasn't as favorable. In this specific case, all the founders eventually left the company. A second major learning relates to the ESOP. Several key employees were incentivized with stock options, but the liquidity preference wiped out their potential gains. The market did not value our company highly enough to cover the balance of our debts and the investors' investments. Often, stock options are issued during the excitement of a fundraising round when the sky seems to be the limit, resulting in a high share price (strike price). This price determines the value at which the stock option beneficiary can sell their shares, only the value above this strike price represents profit. The initial greed of a high valuation can become later extremely painful at the time of exit 😓 A third key learning is the danger of a fragmented cap table, in other words, having no lead investor. We had dozens of shareholders, none with more than 20%. Consequently, everything required extensive coalitions, agreements, discussions and negotiations. These negotiations are emotionally intense and can create tensions. Can people involved move past it? Is it strictly business? While having one dominant lead investor might grant them too much power, having a lead investor is definitely recommended. Finally, we succeeded in returning capital to the shareholders (myself included). We even made a profit. The business is now profitable. The clients and team are happy and can be proud of what they built and are building. We gave the project a new ambition with a new owner. Most incredibly, after 6 years of roller coasters, I managed to remain on good terms with everyone. And even more incredible, I am now in the same coworking space as the initial founder, sitting at the same desk and speaking with him daily! Life's magic. I learned, I am learning and I continue to dream of empowering founders, as business angel and/or Board Director, to build right from Belgium world-class startups! So let's build bridges, share knowledge and scale it up!