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Flexible VC, a New Model for Companies Targeting Profitability

David Teten

Eligible for favorable treatment under Qualified Small Business Stock exemption, if structured as equity. This applies if the investment converts into common stock; details are beyond this essay’s scope. Coinvestors: Flexible VC terms have not been standardized, which may make the investment harder to syndicate.

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Not Building a Unicorn

Austin Startup

This is most clearly highlighted in the “unicorn” boom we all saw over the past few years, where founders raised very large rounds, with terms very onerous to the underlying common stock, hoping they could eventually justify billion dollar valuations to skeptical acquirers or public market investors.