Is the sale a win for investors, execs and Walmart?


I’ve heard a lot of people talk about the sale to for $3B as a failure or bail-out of a business that is going downhill. At the same time, if you look at the numbers, it looks like all parties involved are coming out ahead. Yes, I think’s plans were to build a big successful business, but in falling short of that, it’s hard to deny that they did create an outcome that is likely seen as a win for all parties involved. Here’s a quick look at how this breaks-down:

Investors – in November, raised $350M at a $1.35B valuation. While it’s not 10,000% return, investors are going to be doubling their money in less than a year which I’d imagine most people would be pretty happy with. Early investors are going to get 3x – 5x what they invested. Usually when a startup fails, investors lose all of their money, they don’t double, triple, or quadruple it so it’s hard to say this is a failure when investors are getting an 100%+ return in the worst-case.

Execs – founder Marc Lore is going to make around $750M in this sale and a lot of the top execs at are leaving with a very nice bonus. It’s hard to say you failed when you take home $750M after a couple of years of work. Usually when a founder fails, they take home $0 and often lose money.

Walmart – is doing $99B/year online, Walmart is doing closer to $15B/year online and their business is flattening out. While didn’t nail the subscription model as they expected there was still a lot of innovative concepts that could really help propel Walmart online, or at least that’s what Walmart is betting on.

So next time you read an article that pitches as a failure or mentioning that Walmart is saving or bailing out Jet, think a bit more about what a positive outcome this was for everyone. Now compare it to startups that fail and investors and employees lose everything, there’s a big difference.

Morgan Linton

Morgan Linton