Up and Running

FEBRUARY 19, 2014

We all know it’s better to seek good advice and have a safety net before you need it. To learn some common legal pitfalls we’d all be better off avoiding, we asked nine founders from the Young Entrepreneur Council (YEC) what unexpected things they found themselves needing lawyers for in the early stages of their startups.

Non-disclosure Agreement 97

Non-disclosure Agreement NDA Term Sheet Early Stage 97

Altgate

DECEMBER 16, 2010

@altgate Startups, Venture Capital & Everything In Between Skip to content Home Furqan Nazeeri (fn@altgate.com) ← Pre-Money Valuation vs Number of Founders Where Do Tech VCs Invest? One of the least understood of these key terms is the liquidation preference. Liquidation Preferences | counsel startup [.]

Liquidation Preference 39

Liquidation Preference Pre-Money Valuation Term Sheet Valuation 39

OnlyOnce

APRIL 27, 2021

Last week, I blogged about Bolster’s Board Benchmark survey results , which really laid bare the lack of diversity on startup boards. My new mantra for Startup Boards is simple: 1-1-1. Your best bet is to do it early in the process before you have a term sheet, and do it as an exploratory conversation.

Vesting 48

Vesting Cofounder Startup Term Sheet 48

This is going to be BIG.

MAY 26, 2022

They’ll obviously see the value of what you built and will be compelled to offer a term sheet on the spot. Well, at 125 words per minute, 48 minutes of podcasting will net you a chapter. So, if you were actually trying to turn your podcast content into a book, it would probably take you between 2-3 podcasts to net a chapter.

Founder 103

Founder .Net Term Sheet Aggregator 103

Business Plan Blog

NOVEMBER 13, 2013

Most startup founders do not have enough capital to launch their companies and need to raise money at some point. FFF investing is not a short-term play and mostly investors do not get a return on their investment immediately. Individual investors who provide financial funding to startups are called ‘Angel Investors.’

Finance 93

Finance Accredited Investor Angel Investor Seed Capital 93

David Teten

AUGUST 19, 2019

We’re currently evaluating about 20 companies a month and issuing term sheets to 25% of them; those that fit our investment criteria. Founder Earnings = Net Income + any amount of founders’ salaries over a certain threshold. Up to $3M in growth capital for your tech startup”. Repaid over 3–5 years”. over up to 5 years.

Revenue 60

Revenue Technical Review Software Review Equity 60

Both Sides of the Table

JULY 19, 2011

On balance I usually prefer to recruit people from my network both in terms of saving costs as well as hiring people I know & trust. That said, there are times where you need to cast a wider net. Lawyers : So you got your big term sheet signed and you’re now in the drafting. No “back room deal.&#.

Term Sheet 319

Term Sheet PR Liquidation Preference Stock Options 319

Gust

OCTOBER 8, 2014

If you want a great primer on how the VC and startup funding scene changed here’s a great primer. I had very smart entrepreneurs where I gave the company $2-3 million and we raised anywhere between $3-5 million and when I put A-round in the term sheet they had their lawyers change it back to seed rounds.

Cap Table 136

Cap Table Silicon Valley Term Sheet Non-Compete 136

Tim Keane

MARCH 8, 2010

Startups and angels: Along the way to success. A philosophy of valuations and term-sheets » March 08, 2010.   The premise is that having sufficient net worth makes the investor more sophisticated.    The premise is that having sufficient net worth makes the investor more sophisticated. 

Accredited Investor 60

Accredited Investor Wisconsin Angel Investor Bootstrapping 60

www.paulgraham.com

APRIL 28, 2010

Want to start a startup? A typical startup goes throughseveral rounds of funding, and at each round you want to take justenough money to reach the speed where you can shift into the nextgear. Few startups get it quite right. 1 ] A startups life will be more complicated, legally, if any of theinvestors arent accredited.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

Hunter Walker

JANUARY 23, 2015

Although the way we spend our days are different than the teams we’ve backed, Homebrew started in Jan 2013 with the goal of feeling like a startup, just one which writes checks instead of code. This is a conversation which should happen before the term sheet has been signed). It’s imperfect but works for us at this stage.

Cofounder 48

Cofounder Term Sheet Metrics .Net 48

Reid Hoffman

JULY 27, 2021

I have a standard aphorism I share when I speak with a group of MBA students: “There are two things that need to be explained away in order for me to invest in your startup: An MBA or a background in management consulting.”. Nothing gets in the way of their pursuit of startup success. Networks are both safety nets and trampolines.

Silicon Valley 69

Silicon Valley Venture Capital Balance Sheet Cofounder 69

Reid Hoffman

JULY 27, 2021

I have a standard aphorism I share when I speak with a group of MBA students: “There are two things that need to be explained away in order for me to invest in your startup: An MBA or a background in management consulting.”. Nothing gets in the way of their pursuit of startup success. Networks are both safety nets and trampolines.

Silicon Valley 69

Silicon Valley Venture Capital Balance Sheet Cofounder 69

Startup Professionals Musings

JUNE 6, 2022

Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money. Start in a business domain you know well.

Liquidity Event 300

Liquidity Event Angel Investor SEC Accredited Investor 300

Both Sides of the Table

SEPTEMBER 2, 2009

The net effect for [my company] for example is we are now doing reasonably well. Many term sheets ensued. I had that against the backdrop of several term sheets. Tags: Pitching VCs Start-up Advice VC Industry startup technology vc venture capital. I think it breaks for most people after 3-4 years.

Founder 329

Founder Liquidation Preference Term Sheet Participating Preferred 329

Berkonomics

DECEMBER 17, 2020

There is an exemption from the requirements that these investors be accredited with net worth or income minimums to qualify legally to invest in your company. If you have a virtual company with your employees working from home locations, as many startups do, it should be the location of the founder. We’ll call these “inside angels.”

Equity 62

Equity Finance Liquidity Event Angel Groups 62

www.payne.org

SEPTEMBER 22, 2011

Startup Equity For Employees. The re-heating of the venture funded tech market has pushed a heat up of the hiring market, and Im getting more calls from friends asking for help understanding startup stock (equity) offers. For a very good summary of investor terms, see Brad Felds writeups on term sheet terms.

Equity 56

Equity Employee Vesting Preferred Stock 56

Eric Friedman

AUGUST 18, 2021

Most investors, most people in the startup ecosystem, I would describe as eternal optimists, glass-half-full people. Why are you that way and how do you come to terms with the fact that the sometimes irrational exuberance and optimism of others is the norm? On Dan’s Former Startup. On Dan’s Eternal Optimism (or lack thereof).

Silicon Valley 88

Silicon Valley Venture Capital Cofounder Africa 88

Steve Blank

FEBRUARY 26, 2020

Not all startups need outside investment to grow. What most founders don’t realize is: Every stage of a startup requires a different set of metrics and milestones and founder skills. Here’s the first 2½ years of a startup journey. The Startup Investment Landscape. Still, there are some benchmarks to keep in mind.

Cofounder 429

Cofounder Seed Stage Valuation Metrics 429

Startup Professionals Musings

SEPTEMBER 6, 2019

Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money. Start in a business domain you know well.

Liquidity Event 224

Liquidity Event SEC Entrepreneur Accredited Investor 224

Startup Professionals Musings

NOVEMBER 1, 2013

Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money. Start in a business domain you know well.

Accredited Investor 219

Accredited Investor Liquidity Event Stock SEC 219

David Teten

DECEMBER 3, 2019

See Bessemer Venture Partners’ A comprehensive guide to security for startups. Data companies focused on early-stage startups include Aingel , fundsUP , Preseries , PredictLeads , and Sploda. For more on gathering data and using it to assess companies, see How to Assess Startups Using Machine Learning. 2) Market . 8) Monitor .

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

abovethecrowd.com

APRIL 20, 2016

In February of last year, Fortune magazine writers Erin Griffith and Dan Primack declared 2015 “ The Age of the Unicorns ” noting — “Fortune counts more than 80 startups that have been valued at $1 billion or more by venture capitalists.” Next came Rolfe Winkler’s deep dive “ Highly Valued Startup Zenefits Runs Into Turbulence. ”

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Both Sides of the Table

OCTOBER 9, 2013

I’ve often said that to run a startup you almost have to abstract yourself from the daily stresses and grind just to exist. You might net $1 million and that would change your life. I had foregone my VC term sheets to accept an offer yet I knew it wasn’t 100% probability to close – it never is.

San Francisco 405

San Francisco Term Sheet Flash .Net 405

Startup Professionals Musings

SEPTEMBER 24, 2012

Reuters TV Interview by Rhonda Schaffler Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money.

Portfolio 228

Portfolio Accredited Investor Liquidity Event SEC 228

Startup Professionals Musings

SEPTEMBER 16, 2017

Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money. Start in a business domain you know well.

Liquidity Event 184

Liquidity Event SEC Accredited Investor Angel Investor 184

venturehacks.com

SEPTEMBER 22, 2011

Venture Hacks Good advice for startups. For the average startup, that would be an extraordinary bargain. It would improve the average startup’s prospects by more than 43% just to be able to say they were funded by Sequoia, even if they never actually got the money.” SUPPORTED BY. venturehacks. The Equity Equation.

Equity 40

Equity Cap Table Valuation RSS 40

Startup Lessons Learned

AUGUST 17, 2020

We literally started just as we got our first term sheet for investment on the day that we graduated from business school in June of 2006. And it was actually the same time that Kristen was giving birth to her first baby, literally the same day that we received the term sheet and graduated from business school.

Cofounder 60

Cofounder Security Founder Entrepreneur 60

techcrunch.com

NOVEMBER 2, 2010

Convincing venture capitalists to invest in two startups in less than 365 days was a challenging task, but one that quickly taught me the dos and don’ts of raising money. I wouldn’t recommend this if you’re meeting with more than 2 people, but this meeting was one of my best and resulted in a term sheet. Why did this work?

Technical Review 100

Technical Review San Francisco Framework Term Sheet 100

Startup Professionals Musings

FEBRUARY 6, 2015

Investing in entrepreneurs and startups is a fun but different world from investing in conventional stocks, bonds, and commodities. First of all, it’s more of an investment in people than in a business, since the startup is usually an idea barely half-baked when they need your money. Start in a business domain you know well.

Accredited Investor 120

Accredited Investor Liquidity Event SEC Entrepreneur 120

www.currentlyobsessed.com

MAY 28, 2010

I have to admit, the light bulb didn’t go off for me until I was negotiating term sheets. Read up on the “unwritten terms&# in term sheets having to do with exit multiples here For bootstrappers, the math is even easier: 100% of the upside goes to you and your awesome team. Like this post?

Valuation 42

Valuation Channel Pre-Money Valuation Term Sheet 42

Gust

OCTOBER 26, 2011

As we conclude our convertible note financing series, there are assorted terms commonly seen in term sheets and deal documents that are worth touching on briefly. Having made it almost to the end of our sample term sheet: Documentation. Returning to our sample term sheet: Note Purchase Agreement.

Finance 79

Finance Term Sheet Covenant Accredited Investor 79

Both Sides of the Table

APRIL 3, 2010

As a reminder, VC funds are comprised of money from LP’s (Limited Partners) that include university endowments, pension funds, high-net-worth individuals, insurance companies and large corporations. In a single fund of $100 million you might have 30 difference LPs. Now, let’s get more ominous.

Pre-Money Valuation 226

Pre-Money Valuation Venture Capital LP Term Sheet 226

A Smart Bear: Startups and Marketing for Geeks

JUNE 27, 2011

There are plenty of folks who wouldn’t sell their company for a billion dollars; Jason Fried and Joel Spolsky are public examples from the bootstrapped startup world. What if someone offered you a million dollars for your startup, right now, check in hand — would you take it? “Net net,&# some people say.

Sales 235

Sales Term Sheet Stock Deal Structure 235

Austin Startup

APRIL 1, 2017

out of state VCs Don’t rush a term sheet In assessing financing terms and interacting with their lead investors, most founders instinctively focus on two core things: economics and control. Others will say to relax, let your guard down, and not be so cautious; but their net worth isn’t riding on one horse.

Term Sheet 48

Term Sheet Institutional Investors Technical Review Lead Investor 48