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Silicon Valley Frontlines: Two Tales of "Working For Equity"

philipsmith.typepad.com

a year burn rate and your equity is worthless due to numerous recapitalizations and bridge loans from investors then either you don't get it or I'm stupid to do it. Looks like you should have hired a CFO a long time ago! The second example came along just this morning. Don't get me wrong.

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On the Road to Recap:

abovethecrowd.com

The pressures of lofty paper valuations, massive burn rates (and the subsequent need for more cash), and unprecedented low levels of IPOs and M&A, have created a complex and unique circumstance which many Unicorn CEOs and investors are ill-prepared to navigate. Layoffs have also become more prevalent.

IPO 40
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Stock Market Drops. Then It Rallies. What Happens Next for Funding?

Both Sides of the Table

Companies raised too much money in 2005-08 and had high burn rates. On the positive side, corporate profits are up, their balance sheets have been repaired and they have recapitalized themselves to have lower amounts of debt relative to equity. tl;dr summary. VCs were very active in this period. So no new deals got done.

Stock 305