Both Sides of the Table

JULY 22, 2010

Things like “ participating preferred stock &# in legalese unsurprisingly never actually call out, “hey, this is the participating preferred language.&# We got a3x participating liquidation preference with interest (not participating with a 3x cap, but 3x participating. I turned them down.

Valuation 405

Valuation Liquidation Preference Pre-Money Valuation Term Sheet 405

Both Sides of the Table

APRIL 14, 2010

That means that the likely have a minimum of $15 million in liquidation preferences. It will usually be higher because the liquidation preference has a dividend so if the deal is long in the tooth assume that the liquidation preference might be $20-22 million. Some investors love to get out sharp elbows.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Pre-Money Valuation 289

Both Sides of the Table

SEPTEMBER 5, 2012

Because convertible debt deals often have both a ‘full ratchet’ and often have ‘multiple liquidation preferences’ “ Yup. So Investor A might have bought 20% of your company in 2012 and in 2013 with no addition money invested suddenly owns 40% of your company. That’s right.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354