Author Topic: Linus Sebastion Turned Down $100M Offer  (Read 20196 times)

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Offline EEVblogTopic starter

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Linus Sebastion Turned Down $100M Offer
« on: May 25, 2023, 02:44:17 am »
Linus turned down a $100M offer for Linus Tech Tips. 60% cash, 40% equity.
And he (plus his wife) are the sole owners.
Repect  :-+

 

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #1 on: May 25, 2023, 03:25:17 am »
we would like to possess your work for use as a marketing vector
 

Online SiliconWizard

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #2 on: May 25, 2023, 03:30:50 am »
He managed to create quite a big business just with "tech enternainment". Whether we find it interesting or not, that's amazing.

Given how his business must be making, selling it at this point wouldn't make much sense. He's too young for that. He gets way enough money as it is, and selling it would probably mean half of his employees getting fired too. So yeah. But yes he's looking for a CEO.
 

Offline mawyatt

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #3 on: May 25, 2023, 03:03:49 pm »
Admire him and his vision :-+

His comments about "Selling Out" are spot on  :clap:

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Offline nctnico

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #4 on: May 25, 2023, 03:09:38 pm »
Admire him and his vision :-+

His comments about "Selling Out" are spot on  :clap:
Don't think so. As a business owner it is better to sell out and cash in when the chance arrives. I know quite a few who didn't sell and saw their 'fortune' evaporate to zero. As a business owner, number one is yourself. Learn not to care about people in the sense that they are family of some sort. Qualified people will always find a good job (and are likely to leave at some point anyway) and there is also the possibility to start something new with members of the team that don't like the new management and/or are laid off. One of my former employers sold the company for good money and nowadays he employs many of the old staff.

As Linus is stepping down as CEO, there will be new management so from a functional perspective he should cash in anyway. With 40% in equity, he'd still own a major part of the company, be able to influence how the company is being run AND have money in the bank.
« Last Edit: May 25, 2023, 03:17:00 pm by nctnico »
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Offline HighVoltage

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #5 on: May 25, 2023, 03:17:13 pm »
Linus turned down a $100M offer for Linus Tech Tips. 60% cash, 40% equity.
And he (plus his wife) are the sole owners.
Repect  :-+

Only time will tell, if this was a good move.
There are 3 kinds of people in this world, those who can count and those who can not.
 
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Online ebastler

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #6 on: May 25, 2023, 03:24:41 pm »
With 40% in equity, he'd still own a major part of the company, be able to influence how the company is being run AND have money in the bank.

He would have received $40M worth of equity in the buyer company. Since we don't know how big that company is, we have no idea whether that share would have bought him any influence.
 
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Offline mawyatt

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #7 on: May 25, 2023, 03:31:12 pm »
Admire him and his vision :-+

His comments about "Selling Out" are spot on  :clap:
Don't think so. As a business owner it is better to sell out and cash in when the chance arrives. I know quite a few who didn't sell and saw their 'fortune' evaporate to zero. As a business owner, number one is yourself. Learn not to care about people in the sense that they are family of some sort. Qualified people will always find a good job (and are likely to leave at some point anyway) and there is also the possibility to start something new with members of the team that don't like the new management and/or are laid off. One of my former employers sold the company for good money and nowadays he employs many of the old staff.

As Linus is stepping down as CEO, there will be new management so from a functional perspective he should cash in anyway.

Obviously you've never been there and done that, we have :-+

We sold out in 2006 for $25M, and should have held out for more (long story). The SoC RFIC technology we had that was the core reason for our acquisition was attractive to a few high tech companies, the company that acquired us then destroyed such, as we found out later, was more about keeping their competitor from acquiring the technology than utilizing such (very poor short term thinking senior management).

So selling out may not be the best case in many situations, as Linus correctly mentioned being controlled my short term thinking management. Where "best" isn't always about $, been there done that and suffered the consequences :P

Best,
Curiosity killed the cat, also depleted my wallet!
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Offline Marco

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #8 on: May 25, 2023, 03:32:16 pm »
Don't think so. As a business owner it is better to sell out and cash in when the chance arrives. I know quite a few who didn't sell and saw their 'fortune' evaporate to zero.
Only a risk if they didn't run a substantial profit or reinvested everything and gave themselves a pittance for salary.

He said he was already rich so presumably that was not the case for him. If it goes tits up he will have lost the chance of being filthy rich and will have to settle with being plain rich.
 

Offline Zucca

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #9 on: May 25, 2023, 03:35:31 pm »
interesting topic, but is it a technical topic for a technical only general chat section?
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Offline Bud

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #10 on: May 25, 2023, 03:37:48 pm »
I get no understanding what is the value of this channel. If it disappears tomorrow there will be Zero impact on technology or relevant computer skills. Kudos to Linus managing to build such Nothing Burger.
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Offline nctnico

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #11 on: May 25, 2023, 03:55:44 pm »
Admire him and his vision :-+

His comments about "Selling Out" are spot on  :clap:
Don't think so. As a business owner it is better to sell out and cash in when the chance arrives. I know quite a few who didn't sell and saw their 'fortune' evaporate to zero. As a business owner, number one is yourself. Learn not to care about people in the sense that they are family of some sort. Qualified people will always find a good job (and are likely to leave at some point anyway) and there is also the possibility to start something new with members of the team that don't like the new management and/or are laid off. One of my former employers sold the company for good money and nowadays he employs many of the old staff.

As Linus is stepping down as CEO, there will be new management so from a functional perspective he should cash in anyway.

Obviously you've never been there and done that, we have :-+

We sold out in 2006 for $25M, and should have held out for more (long story).
You mean you have  8) But your claim is that you sold too early. Ofcourse you can always debate valuation of your company and hope for more (which may never come). Good investors however, set predefined targets for when to buy / sell shares in order not to get carried away and start to make emotional instead of rational decissions. On top of that, it looks like you valued the technology you have developed much higher than what the market was willing to pay for it. Otherwise it would have been used in products instead of being pulled from the market as a precaution.
« Last Edit: May 25, 2023, 03:59:41 pm by nctnico »
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Offline mawyatt

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #12 on: May 25, 2023, 03:59:42 pm »
Don't think so. As a business owner it is better to sell out and cash in when the chance arrives. I know quite a few who didn't sell and saw their 'fortune' evaporate to zero.
Only a risk if they didn't run a substantial profit or reinvested everything and gave themselves a pittance for salary.

He said he was already rich so presumably that was not the case for him. If it goes tits up he will have lost the chance of being filthy rich and will have to settle with being plain rich.

Yep, not everyone aspires to be a Elon Musk, Larry Ellison, or Bill Gates!!

Interestingly we all discuss about how short term thinking is what's it's all about in business today, few if any CEOs are long term thinkers and most adhere to Wall St and Share Holder values, like quarterly returns and stock value!!

Yet many of us here, ourselves included, worked our way thru college flipping burgers, mowing yards, painting houses, repairing TV & Stereos, whatever it took to stay in school and survive. Now what kind of thinking was that? We all could have got better paying 8-5 jobs and forgo college! We didn't, we were all long term investing in our future, not short term pocketing more $ with less life stress!! Yet some of these same folks that made that long term investment for college now are making the short term decisions in most companies.

Long ago when we were proposing for investment $ in a local university lab we had a projector slide preparation (yes, that long ago, PP wasn't around then!!), we looked around the room of executives, from MIT, Stanford, Cornell, Columbia, USC, RTI and so on and realized the presentation was hopeless, so we didn't present the slides and used the above long term college investment as a challenge to each and everyone in the room!! Ironically this resonated (at least for awhile) and we got the substantial funding requested :-+

Best,
Curiosity killed the cat, also depleted my wallet!
~Wyatt Labs by Mike~
 

Offline mawyatt

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #13 on: May 25, 2023, 04:14:09 pm »

You mean you have  8) But your claim is that you sold too early. Ofcourse you can always debate valuation of your company and hope for more (which may never come). Good investors however, set predefined targets for when to buy / sell shares in order not to get carried away and start to make emotional instead of rational decissions. On top of that, it looks like you valued the technology you have developed much higher than what the market was willing to pay for it. Otherwise it would have been used in products instead of being pulled from the market as a precaution.

These weren't investors, but major tech companies. There were 3 majors involved after a failed attempt by IBM to acquire us (long story about disgruntle employee trashing the deal). The sale involved the 1st to offer the minimum acceptable bid, without allowing the others to submit a "Best and Final", as we found out after the sale, there were some back scene shenanigans going on with some of the principles (another long story).

As Mulder and Scully said, "Trust No One"!!

Best,
Curiosity killed the cat, also depleted my wallet!
~Wyatt Labs by Mike~
 

Offline Bud

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #14 on: May 25, 2023, 08:30:17 pm »
Yep, not everyone aspires to be a Elon Musk, Larry Ellison, or Bill Gates!! 
Speaking of which, we are going to the Cinema tonight to watch "Blackberry", about the rise and fall of Research In Motion company, the manufacturer of Blackberry devices.
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Offline nigelwright7557

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #15 on: May 25, 2023, 09:02:11 pm »
He found a hole in the PC entertainment market and used it to get to the top.
Well done.
However what goes up can come down so maybe selling while at the top is a good idea.
 

Offline Ed.Kloonk

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #16 on: May 25, 2023, 10:19:09 pm »
I'm not convinced that the deal is so fantastic. It sounds like a lot of cash but it really isn't.
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Offline thm_w

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #17 on: May 25, 2023, 10:39:54 pm »
:-+ Both him and his wife are highly skilled so even if the company implodes he'll be fine.
If anyone near Vancouver wants to meet Rossmann, electroboom, or der8auer, should be at his event July 29th: https://www.ltxexpo.com/creators

Yep, not everyone aspires to be a Elon Musk, Larry Ellison, or Bill Gates!! 
Speaking of which, we are going to the Cinema tonight to watch "Blackberry", about the rise and fall of Research In Motion company, the manufacturer of Blackberry devices.

Start your own thread instead of shitting all over this one.
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Offline asmi

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #18 on: May 26, 2023, 02:11:10 pm »
I'm not convinced that the deal is so fantastic. It sounds like a lot of cash but it really isn't.
It IS a lot of cash. It is at least an order of magnitude more than what vast majority of people on this planet will earn over their entire life.
 
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Offline Ed.Kloonk

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #19 on: May 26, 2023, 04:46:40 pm »
I'm not convinced that the deal is so fantastic. It sounds like a lot of cash but it really isn't.
It IS a lot of cash. It is at least an order of magnitude more than what vast majority of people on this planet will earn over their entire life.
But not Linus' and Yvonne's life. That's a whole different scale by itself, you've made my point for me. These lump sum amounts go fast, especially if you have the mindset that it's an unbelievable amount.

Statistics don't lie. When you've come into a lot of money without being born into money, there is a very high risk that it all gets blown within just a few years, statistically speaking. So much so that the phenomenon had caused some lotteries around the world not to award the winnings to you in a lump sum  (one of ours does here).

I think L & Y have done a smart move. Essentially, make the company pay them a wage, at least until that CEO can teach them how to handle money without being distracted by all the admin of having it. That said, he -could- always let-go the CEO and still attract an even bigger sale in a few years anyway. The company will be better for it.
« Last Edit: May 26, 2023, 05:03:41 pm by Ed.Kloonk »
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Offline nctnico

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #20 on: May 26, 2023, 05:18:33 pm »
I'm not convinced that the deal is so fantastic. It sounds like a lot of cash but it really isn't.
It IS a lot of cash. It is at least an order of magnitude more than what vast majority of people on this planet will earn over their entire life.
But not Linus' and Yvonne's life. That's a whole different scale by itself, you've made my point for me. These lump sum amounts go fast, especially if you have the mindset that it's an unbelievable amount.

Statistics don't lie. When you've come into a lot of money without being born into money, there is a very high risk that it all gets blown within just a few years, statistically speaking. So much so that the phenomenon had caused some lotteries around the world not to award the winnings to you in a lump sum  (one of ours does here).
The alternative is that the company's value drops significantly resulting in the same monetary loss. Building wealth by cashing out & re-investing every now and then spreads the risk and solidifies the foundation. IOW: spread your eggs over several baskets if you can. Where it comes to blowing all the money: you can't fix stupid.
There are small lies, big lies and then there is what is on the screen of your oscilloscope.
 

Offline Ed.Kloonk

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #21 on: May 26, 2023, 05:52:18 pm »
I'm not convinced that the deal is so fantastic. It sounds like a lot of cash but it really isn't.
It IS a lot of cash. It is at least an order of magnitude more than what vast majority of people on this planet will earn over their entire life.
But not Linus' and Yvonne's life. That's a whole different scale by itself, you've made my point for me. These lump sum amounts go fast, especially if you have the mindset that it's an unbelievable amount.

Statistics don't lie. When you've come into a lot of money without being born into money, there is a very high risk that it all gets blown within just a few years, statistically speaking. So much so that the phenomenon had caused some lotteries around the world not to award the winnings to you in a lump sum  (one of ours does here).
The alternative is that the company's value drops significantly resulting in the same monetary loss. Building wealth by cashing out & re-investing every now and then spreads the risk and solidifies the foundation.

In this climate? Who knows? We'll find out together.
iratus parum formica
 

Offline asmi

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #22 on: May 26, 2023, 07:48:43 pm »
But not Linus' and Yvonne's life. That's a whole different scale by itself, you've made my point for me. These lump sum amounts go fast, especially if you have the mindset that it's an unbelievable amount.
That's because it is. Even if you blow 100k$ a month, 60M$ will last 50 years, ignoring any interest which can be made. Even at 2%/year you can be blowing 100K$/month forever, as it will bring you 1.2M$ a year in capital gains.

Offline Bud

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #23 on: May 26, 2023, 07:56:35 pm »
You all forget tax.
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Online SiliconWizard

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Re: Linus Sebastion Turned Down $100M Offer
« Reply #24 on: May 26, 2023, 08:25:25 pm »
You all forget tax.

Yep. True.

And anyway, which I guess was the point of Dave's "Repect  :-+", not to lecture anyone at all, but just saying, not everything is about making a pile of cash and then burning it while having nothing else to do.

Someone running a successful business they have built from scratch and that they enjoy, with tens of employees that they like working with, why would they want to get rid of all this just for a pile of money (that as Bud said you'll burn in tax in probably a ton of stuff you don't really need, while suddenly finding yourself with no occupation), unless they had no choice (like huge debts)?

 :popcorn:
 
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