How an offer to sell our business inspired us to take on $17M in debt

One thing I wonder about starting your own business like this is if you do sell .... if there's a bit of a sense of loss. Things change forever, you were successful, but it's fundamentally a different game / company now.

Great read. Question, since Wistia took capital from private equity (Accel-KKR). These guys typically invest in equity-like instruments. Is there PIK (payment-in-kind) on the debt or does it have equity like upside? PIK debt can have ~7-15% interest where maybe half or all of the interest accrues in the form of more debt which in turn has PIK. Accel-KKR might be looking at a nice ~12% return (IRR) with relatively low risk. <i></i> Note: figures above are made up.

I&#x27;m wondering what happens to the cap table now. Lets say after many raises the investors own 50% of the company and 50% is founders and employees. If the company borrows money to buy out the investors, does that mean the 50% owned by founders&#x2F;employees turn into 100%? I&#x27;m thinking the valuation would still remain the same, which means suddenly their value goes up significantly.

What would the financial implications be if founders bought out investors like this, but then raised a larger round at a higher valuation? Does that happen? I never even considered taking on debt to buy out investors - but after seeing this it seems like a lot of high growth startup founders could position themselves well by doing so.

Does it say how much was offered to buy the business?