Both Sides of the Table

JULY 29, 2010

We received so much positive feedback from our This Week in Venture Capital show walking through valuation calculations & term sheets that we decided to do a Q&A show this week to address topics that entrepreneurs want to learn about. In fact, far better if you haven’t raised venture capital.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

Steve Blank

APRIL 26, 2022

Except, that is, for the bottom feeders of the Venture Capital business – investors who “ cram down ” their companies. They offered desperate founders more cash but insisted on new terms, rewriting all the old stock agreements that previous investors and employees had. Why do VCs Do This? You’re not.

Cram Down 413

Cram Down Founder Venture Capital Recapitalization 413

Both Sides of the Table

SEPTEMBER 18, 2014

On the phone … Me: So, you raised venture capital? Revenue multiple? Less than you’ll probably grant your most junior employees in stock options? If you want to give them a 50% discount offer them $1 of common-stock warrants (no liquidation preference) for every $1 of stock they buy.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Steve Blank

APRIL 10, 2019

VC’s have just changed the ~50-year old social contract with startup employees. For most startup employee’s startup stock options are now a bad deal. As Venture Capital emerged as an industry in the mid 1970’s, investors in venture-funded startups began to give stock options to all their employees.

Stock Options 334

Stock Options Stock Vesting Common Stock 334

www.inc.com

SEPTEMBER 24, 2011

Employee Benefits. Why Arizona Bay started taking stock from its customers instead of cash. Dave Graham Business Venture Capital Private Equity GlobalLogic Inc. Venture Capital Firms. Jumpstart wasnt much at the time, just four employees working from home offices. Financing A Small Business.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Up and Running

SEPTEMBER 19, 2017

For a business that anticipates needing, for example, $500,000 in startup capital, that means that best-case scenario Klemm can expect to give up half of his business’s common stock (and an even larger percentage of control of the business once the deal’s fine print provisions are considered). Those days are long gone.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

Steve Blank

OCTOBER 24, 2017

— Unremarked and unheralded, the balance of power between startup CEOs and their investors has radically changed: IPOs/M&A without a profit (or at times revenue) have become the norm. Typically, this caliber of bankers wouldn’t talk to you unless your company had five profitable quarters of increasing revenue.

Founder 263

Founder Technical Review CTO Hire IPO 263