David Teten
JANUARY 19, 2021
Coinvestors: Flexible VC terms have not been standardized, which may make the investment harder to syndicate. Governance. Coinvestor friction risk: Earlier investors : Earlier investors come in at a riskier stage and through equity, and may be uncomfortable with a later investor getting any compensation before them.
Pascal's View
JULY 9, 2017
The most serious unintended consequence occurs from “note waterfalls”— converting multiple notes that have multiple valuation caps. Many entrepreneurs lose track of what they have been cooking up in the cap table. They do not recognize that they may have already contractually sold a meaningful portion of equity in their company.
www.paulgraham.com
APRIL 28, 2010
Some angel investors join together in syndicates. At one extreme is the sort of pork-barrel project wherea town gets money from the state government to renovate a vacantbuilding as a "high-tech incubator," as if it were merely lack ofthe right sort of office space that had till now prevented the townfrom becoming a startup hub.
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