Startup Professionals Musings

SEPTEMBER 27, 2023

Every entrepreneur needs to understand the following basics, to be addressed at company formation, as they engage a qualified attorney to draw up the paperwork: Allocate founder’s stock commensurate with commitment. Key founder vesting should have no cliff. This is called stock dilution control.

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Stock .Net Vesting Founder Vesting 240

This is going to be BIG.

JANUARY 18, 2024

Some of these folks are founders and CEOs, but not at high-growth tech startups. On the other hand, they could be the opposite—much more focused on near-term cash distributions than long-term equity appreciation. The first thing you need to get straight with a high net worth individual—what is their return expectation?

.Net 88

.Net Cap Table Startup Technical Review 88

Gust

APRIL 11, 2014

Let’s get right down to business: Dilution of founders’ and other early shareholders’ equity in startups is frequently a subject of intense interest and debate. That’s the concept of what some call mathematical dilution. Before, it might have net assets that are near zero.

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Dilution Equity Pre-Money Valuation Prospectus 162

David Teten

AUGUST 19, 2019

This structure offers some of the benefits of traditional equity VC, without some of the negatives of equity VC. I’ve been a traditional equity VC for 8 years, and I’m now researching new business models in venture capital. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control.

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Revenue Technical Review Software Review Equity 60

David Teten

AUGUST 21, 2019

Most founders who are raising capital look first to traditional equity VCs. Revenue-Based Investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. For more background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Less or no dilution.

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Revenue Liquidation Preference Equity Cofounder 60

Altgate

MAY 24, 2012

Mark Zuckerberg and his executive team have been extremely successful at retaining equity in their company. But how well do most other founders do? Even as Facebook prepares to go public, Mark Zuckerberg, the founder and CEO, still owns 28% of his company. How did they do this? Fear vs. Greed. Third round: Raise $27.5

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Pre-Money Valuation Cofounder Dilution Valuation 43

venturehacks.com

SEPTEMBER 22, 2011

The Equity Equation. As this nuclear winter of venture hacks continues, I thought you might enjoy our thoughts on Paul Graham’s The Equity Equation. ” Read the rest of The Equity Equation first; it is great. You have to pay market rates regardless of the equity equation. Venture Hacks Good advice for startups.

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Equity Cap Table Valuation RSS 40