Feld Thoughts

FEBRUARY 9, 2016

I learned this lesson 127 times between 2000 and 2005. I started investing in 1994 and while there was some bumpiness in 1997 and again in 1999, the real pain happened between 2000 and 2005. I suffered through the next financing after implementing a complex structure, or a sale of the company, or a liquidation.

Cap Table 70

Cap Table Down Round Liquidation Preference Founder 70

Both Sides of the Table

SEPTEMBER 6, 2010

I freely admit this (along with nearly everything between 1999-2000) was a mistake. That said, don’t complicate the topic – If you’re the founder of a company you likely know a lot about things like Liquidation Preferences and how they affect value allocations when the company is sold.

Stock Options 294

Stock Options Stock Valuation Liquidation Preference 294

Spencer Fry

APRIL 17, 2017

Long story short, it’s just not 2000's anymore. As a bootstrapper, you have nobody above you on the cap table (note: investors sit above you in their liquidation preference), so it’s your way or the highway. The quality bar has never been higher. Nobody can tell you what to do.

Bootstrapping 63

Bootstrapping Cap Table Liquidation Preference Cofounder 63

Feld Thoughts

FEBRUARY 28, 2023

Conversion right: In Germany, there is generally no conversion right entitling the holder of preferred shares to convert them into common shares at any time. This may not seem like a big deal at first glance, but it has extensive implications under various aspects, such as the structure of the liquidation preference.

Germany 165

Germany Liquidation Preference Option Pool Advisory Board 165

Both Sides of the Table

SEPTEMBER 2, 2009

I took money with a 3x participating preferred liquidation preference with 8% compounded interest annually. Coupled with my participating preferred from 1999 and 2000 I had more than $55 million of liquidation preferences. In my first company I had to raise money in April 2001 or die.

Founder 329

Founder Liquidation Preference Term Sheet Participating Preferred 329

Both Sides of the Table

FEBRUARY 14, 2016

I’d like to explain as best I can my opinion on what is going on because most of what I hear from entrepreneurs is not only wrong but is reminiscent of what I heard in 1997-2000. Or down rounds might favor earlier-stage investors because the liquidation preferences of later stage investors get reduced.

Valuation 150

Valuation Down Round Startup Later Stage 150