Both Sides of the Table
JULY 22, 2010
Things like “ participating preferred stock &# in legalese unsurprisingly never actually call out, “hey, this is the participating preferred language.&# We got a3x participating liquidation preference with interest (not participating with a 3x cap, but 3x participating. I turned them down.
The Equity Kicker
NOVEMBER 9, 2016
I just read a New York Times article that led with the sentence “Deep inside a Silicon Valley unicorn lurks a time bomb”. It turns out that ‘time bomb’ is the much maligned and, I suspect, little understood, liquidation preference. For these reasons our investments at Forward Partners are always in ordinary shares.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Feld Thoughts
JUNE 10, 2022
She has a good article today in TechCrunch titled Embrace the down round (it’s going to be okay, maybe). Brad Feld] says his “strong belief” that “just doing a clean resetting — at whatever the valuation so that everybody is aligned and dealing with reality — is much, much better for a company.”
Tim Keane
JANUARY 12, 2010
Term-sheets and Valuations: Thinking about Negotiations. I’ve sat down with entrepreneurs and a copy of a term sheet guide I like [ “Term Sheets & Valuations - A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations ” by Alex Wilmerding, Aspatore Press.] The Valuation Question.
Both Sides of the Table
SEPTEMBER 5, 2012
This article initially appeared on TechCrunch - with a minor update highlighted in red below. Because convertible debt deals often have both a ‘full ratchet’ and often have ‘multiple liquidation preferences’ “ Yup. Convertible Notes Also Can Have Multiple Liquidation Preferences.
Both Sides of the Table
MAY 13, 2013
If the money comes from professional investors it usually has a “liquidation preference” meaning that their money comes out before the founders or common stock. (If That’s why liquidation preferences exist – downside protection. Almost certainly the startup would have raised some capital.
Feld Thoughts
SEPTEMBER 9, 2015
Some will demonstrate strategically justifiable metrics and have fantastic ‘up round’ exits; others may see liquidation preferences kick in which will negatively impact founders and employees; others may fulfill the adage “IPO is the new down round” , which has been the case for more than half of the public companies on our list.
Expert insights. Personalized for you.
405 
Let's personalize your content