Both Sides of the Table

JULY 29, 2010

The A round was done in February 2000 (end of the bull market) and my B round was done in April 2001 (bear market). The downside is that people need to buy their stock. I talked also about 409a valuations and why common stock purchases cost less than preferred stock purchases. I eventually needed more money.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

Both Sides of the Table

SEPTEMBER 18, 2014

At an accelerator … Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. And so forth.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Gust

SEPTEMBER 17, 2014

Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. It’s like we need a finance 101 course for entrepreneurs.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

Ben's Blog

JULY 16, 2013

3/30/2001: 26.3. They might have said something ridiculous like: “Based on the current price of the preferred stock, your offer is already worth $5M.” As if the common stock were actually the same as preferred stock. Financing capital market down round fundraising outkast' 3/29/1996: 22.3. 3/31/1997: 23.3.

Down Round 78

Down Round Marketing Preferred Stock Post-Money Valuation 78

Startup Company Lawyer

FEBRUARY 21, 2010

I was speaking at an event last month to a group of CEOs and was surprised by the number of CEOs that were worried about the value of their common stock in a M&A transaction. Due to aggregate liquidation preferences that may exceed the acquisition price in an M&A deal, common stock may be rendered worthless.

Retention 31

Retention Liquidation Preference Employee Common Stock 31

Ben's Blog

JULY 16, 2013

3/30/2001: 26.3 They might have said something ridiculous like: “Based on the current price of the preferred stock, your offer is already worth $5M.” As if the common stock were actually the same as preferred stock. One would be wrong: 3/31/1995: 21.0 3/29/1996: 22.3 3/31/1997: 23.3 3/31/1998: 30.8 3/31/1999: 49.7

Marketing 46

Marketing Preferred Stock Post-Money Valuation Down Round 46