Gust
SEPTEMBER 29, 2011
For a traditional VC financing round structured as a sale of preferred stock, the best resources I can recommend are the Term Sheet Series by Brad Feld and Jason Mendelson and Startup Company Lawyer by Yokum Taku. Knowledge is power. If you have any specific questions, please leave them in comments!
Professor VC
APRIL 7, 2011
In a convertible note structure, Im penalized for increasing your valuation. Instead of getting a 2-3x multiple from seed to Series A, I get a discount off of the Series A, so Im better off financially with a lower valuation. Is This a Bridge or a Pier? In cases where it is truly a bridge financing (i.e.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
K9 Ventures
MARCH 23, 2011
The convertible note was really intended as an instrument for a “bridge financing” – when an equity round was imminent, and likely to occur, but the company needed some money in between. In that case, it made good sense to have a debt instrument, where the note holder then converted into equity when the financing occurred.
Both Sides of the Table
MAY 23, 2010
.&# This means that the investment does not have a valuation placed on it. a loan) that is later converted to equity at the time of the next financing. If no financing happened then this “note&# may not be converted and thus would be senior to the equity of the company in the case of a bankruptcy or asset sale.
Startup Company Lawyer
JANUARY 11, 2010
50%) or warrant coverage are typically more company-favorable than a Series A financing where a valuation is set. For example, typical provisions in a company-friendly pre-Series A convertible bridge note financing may include a 20% conversion discount from the Series A price and a 2x return on a sale of company.
Expert insights. Personalized for you.
178 
Let's personalize your content