"That was the case with crypto payments firm Mesh, which announced an $82 million Series B this year that included a $20 million payout to its founder. Ditto with the blockchain social network firm Farcaster, which raised an eye-popping $150 million Series A, but saw its CEO carve off at least $15 million of that. You can read about other examples here."
"These payouts-which are totally above board-take place by means of secondary sales that involve venture firms purchasing some of the founder's personal stock during a round. In VC-speak, the practice is called "taking some off the table" and it's common during frothy markets. During the crypto boom that tailed off in 2021, for instance, the founders of firms like OpenSea and MoonPay collected eight-figure payouts."
Founders increasingly receive large payouts during funding rounds through secondary sales in which venture firms buy founders' personal stock. High-profile crypto startups such as Mesh and Farcaster included multi-million dollar founder payouts inside headline fundraising totals. The practice is referred to as 'taking some off the table' and is common during frothy markets; founders of OpenSea and MoonPay received eight-figure payouts after the crypto boom. Venture firms and founders are often reluctant to discuss these arrangements. Some small investors blame large crypto VCs for offering secondary opportunities to secure lead roles, while larger firms point fingers at generalist firms.
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