Agile VC

APRIL 17, 2011

AGILEVC My idle thoughts on tech startups. Interesting to note that Hafner and English own common stock but also made meaningful investments in the Series A & B rounds. Post-money valuation probably no higher than $12M (2). Pre-money valuation was initially set higher but was adjusted to match the Ser B valuation.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

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. The best thing to get is a “right sized&# valuation. A: It’s not best.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

David Teten

JANUARY 19, 2021

More and more startups are pursuing Revenue-Based VCs , but “RBI” doesn’t fit everyone. Yes, via conversion rights at a valuation cap. Yes, via conversion rights at a valuation cap. Eligible for favorable treatment under Qualified Small Business Stock exemption, if structured as equity. Of the Inc. 5000 companies, only 6.5%

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Startup Professionals Musings

JANUARY 22, 2013

In reality, so-called “founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Valuation has very little meaning until an outsider invests.

Vesting 245

Vesting Common Stock Stock Founder Vesting 245

ithacaVC

APRIL 5, 2011

One rule of simple cap tables is to issue “normal” stock to founders (common stock only) and investors (typically preferred stock, but sometimes common stock to early friends and family). For clarity, it is impossible to issue stock without putting a value on the company.

Common Stock 45

Common Stock Stock Cap Table Preferred Stock 45

Startup Professionals Musings

SEPTEMBER 26, 2015

Perhaps they're way off in their valuation (usually far too high), or paralyzed by fear at seeing the other terms, because they have no idea what's normal, and what's worth a fight to the death (their startup's). In very early startups, which have no valuation, the term sheet may specify a convertible note.

Term Sheet 120

Term Sheet Demand Preferred Stock Liquidation Preference 120

Both Sides of the Table

SEPTEMBER 18, 2014

Me: There is no rational explanation for valuations of A round companies by ANY objective financial measure. If you’re wildly successful early on or if they help you achieve a great valuation they actually pay a significant price for their eventual stock even though they took much more risk than a future investor and backed you early.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Startup Professionals Musings

MARCH 23, 2014

In reality, so-called “Founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Valuation has very little meaning until an outsider invests. Marty Zwilling.

Stock 256

Stock Vesting Common Stock Founder Vesting 256

keen.io

FEBRUARY 5, 2013

How I negotiated my startup compensation. When I started thinking about joining Keen, I quickly realized there is a lot I don’t know about startups. For example: Don’t accept equity compensation (stock shares) without knowing the percentage of the company you’ll own. I knew enough to know I wanted to join a startup.

Salary 50

Salary Equity Startup San Francisco 50

ReadWriteStart

JANUARY 28, 2022

With the rise of startups and growing businesses , it has become more critical for investors to have a thorough understanding of equity to be aware of all of the advantages they are receiving from the companies they have invested in. Common stock. The holding of common stock in a company indicates ownership in the corporation.

Valuation 108

Valuation Equity Warrant Common Stock 108

Austin Startup

JULY 22, 2021

On October 4th, five technology startup finalists will pitch to a panel of advisors and judges made up of successful investors, entrepreneurs, and industry leaders. Any software, hardware, or CPG startup in Texas with a female founder or co-founder can apply to participate. Startups, submit your application now! Who Can Apply?

San Antonio 107

San Antonio Dallas Houston Founder 107

ithacaVC

JANUARY 24, 2013

One interesting point that comes up a lot is how to factor the convertible debt into the premoney valuation of the Series A round. Let’s assume the following: Common Stock outstanding: 3,400,000 shares owned by the founders. I am going to ignore any valuation cap feature.

Valuation 53

Valuation Balance Sheet Option Pool Dilution 53

Startup Professionals Musings

JANUARY 27, 2012

The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.” The pre-money valuation is company value today, while the post-money valuation is the pre-money valuation plus the investment amount. Seat on the board. But the lead Angel would certainly ask to be given a seat.

Term Sheet 223

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 223

Gust

MARCH 16, 2014

In reality, so-called “Founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Valuation has very little meaning until an outsider invests.

Stock 175

Stock Vesting Common Stock Founder Vesting 175

Startup Professionals Musings

SEPTEMBER 14, 2010

The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.” The pre-money valuation is company value today, while the post-money valuation is the pre-money valuation plus the investment amount. Tags: entrepreneur startup angel investment term sheet business.

Term Sheet 227

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 227

The Equity Kicker

NOVEMBER 9, 2016

Additionally, they introduce a small amount of complexity and an element of misalignment between the investor and the common stock holder (usually the founder). Not by much, but by enough that it makes sense for them to accept a liquidation preference in exchange for a higher valuation.

Liquidation Preference 122

Liquidation Preference Silicon Valley Participating Preferred Common Stock 122

Both Sides of the Table

APRIL 14, 2010

Liquidation preference is the amount of money that an investor gets paid before the common stock (e.g. It also gets the new investor concerned that management (common stock holders) will not be incentivized because they realize that the investors will take most of the money unless there is a big upside scenario.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Dividend 289

Gust

DECEMBER 18, 2013

That said, the primary entrepreneur-friendly reason for doing a Convertible Note (and the reason that no serious investor under regular circumstances will therefore do an uncapped note) is: The valuation negotiation is put off until the next round. million valuation provided by the 20% discount of the note.

Valuation 150

Valuation Founder Seed Money Common Stock 150

Startup Professionals Musings

OCTOBER 7, 2010

In reality, so-called “founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Valuation has very little meaning until an outsider invests. Marty Zwilling.

Stock 214

Stock Vesting Common Stock Founder Vesting 214

Haystack

JULY 8, 2018

And with this, every year, a new cohort enters into the “tech startup” world, and there’s no official canon to read, no “one-stop shopping” site or user manual to get briefed on the things you absolutely need to know. You can read more about the types of stock granted in startups here.

Early Stage 95

Early Stage Dilution Private Equity Common Stock 95

www.inc.com

SEPTEMBER 24, 2011

Advisor. ); STARTUP. In the past few years, hundreds of small companies have been snatched up by private equity firms willing to agree to ever-rising valuations. Because many of these businesses dont yet have revenue, valuation discussions arent very scientific, and the process requires some haggling. Email address: Home.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Scott Edward Walker

APRIL 9, 2012

Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook. Why Can’t a Startup Issue Shares of Common Stock to Investors?

Preferred Stock 87

Preferred Stock Finance Common Stock Liquidation Preference 87

Gust

JULY 23, 2012

To qualify for a deduction, the donation must be accompanied by an independent valuation appraisal. Private stock donations have languished despite enormous private company wealth for a few reasons: Few charities accept private stock donations. In fact, the contribution of early-stage company stock can have tremendous impact.

Stock 114

Stock Capital Gains Warrant Stock Options 114

Version One Ventures

APRIL 6, 2021

The company expects its direct listing to occur on April 14, 2021 with its Class A common stock trading on the NASDAQ under the ticker symbol COIN. valuation. . It’s a six-week program guiding founders through the process of launching an amazing new startup on the Arweave’s decentralised web. . SilviaTerra closed a $4.4M

Portfolio 60

Portfolio SEC Common Stock Angel Investor 60

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. The startup process has become demystified – information is everywhere. Not every startup ended up this way. Board Control.

Founder 245

Founder Technical Review CTO Hire IPO 245

Startup Company Lawyer

MARCH 14, 2010

In addition, I think that a “peace treaty&# between early-stage investors and startup companies on standard terms (at least at a term sheet level) is a step in the right direction. Almost all startup companies don’t declare dividends, so deletion of a dividend preference is irrelevant to an investor. under $500K).

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

The Startup Lawyer

FEBRUARY 4, 2011

Great news — your startup just got accepted to an incubator! But before your startup signs up and cashes that $[XX,000] check, your startup’s co-founders should sit down and evaluate the incubator’s offer. Pre-money valuations startups receive from incubators are typically low…really low.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Early Growth Financial Services

JUNE 26, 2014

Baze, Partner at Partech Ventures, Carlos Diaz, CEO at Kwarter, and EGFS’ Chief Strategy Officer Glenn McCrae covered raising funds, how-to pitch VCs, and potential sticking points around valuation. Pre-money valuation — The value of the company prior to investment, calculated on a fully-diluted basis.

Pre-Money Valuation 51

Pre-Money Valuation Option Pool Dilution Common Stock 51

Both Sides of the Table

SEPTEMBER 5, 2012

When convertible debt first started being introduced as a “faster, cheaper way to get startups funded” they didn’t have pricing built into them. What the entrepreneurs were really saying is, “I don’t want to take a lower valuation now, while I don’t have customers or a full team.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

K9 Ventures

NOVEMBER 21, 2011

Let’s say you’re the founder (I use a solo-founder in my example to keep things simple, but this could just as well apply to a founding team) of a startup called Blood, Sweat and Tears, Inc. You raised a Series A round, a Series B round, and this year are just about to raise a big Series C round at a great valuation.

Founder 87

Founder Common Stock Preferred Stock Stock 87

K9 Ventures

NOVEMBER 21, 2011

Let’s say you’re the founder (I use a solo-founder in my example to keep things simple, but this could just as well apply to a founding team) of a startup called Blood, Sweat and Tears, Inc. You raised a Series A round, a Series B round, and this year are just about to raise a big Series C round at a great valuation.

Founder 84

Founder Common Stock Preferred Stock Stock 84

Both Sides of the Table

MAY 13, 2013

For the past 5 years or so Google, Facebook and a handful of tech industry giants have been quietly buying scores of early-stage startups for their talent. A couple of tech giants throw millions around in either cash (for which they have hoards) or part with some publicly traded stock. Go do a startup. Startup Advice'

Liquidation Preference 357

Liquidation Preference Early Stage Retention Lock-up Period 357

Gust

OCTOBER 12, 2011

In my experience, a term of 12 to 24 months is common, with 12 months being on the short end. That is obviously a challenge for the typical cash-strapped early stage startup that is seeking to raise more capital and is not in any kind of position to be repaying loans. First, a word about the maturity date.

Finance 107

Finance Term Sheet Pre-Money Valuation Early Stage 107

The Next Web

JUNE 17, 2015

Giving up equity in your business, as an alternative to paying cash, often sounds like a great idea to cash-starved startups. You always want to raise cash from equity investors with experience in building startup businesses, often with a rolodex of potential business contacts and lessons learned from their past investments.

Equity 60

Equity Valuation Preferred Stock Common Stock 60

Gust

OCTOBER 21, 2011

For convertible notes, the only liquidity event we need be concerned with is an acquisition of the startup in the near future, before the maturity date; otherwise, the notes will convert to equity of one kind or another, and the eventual sale of that equity (in a public offering, acquisition, or private sale) is a different subject for another day.

Finance 79

Finance Pre-Money Valuation Term Sheet Liquidity Event 79

Berkonomics

MAY 22, 2014

Angels, as group of accredited investors funding startup companies, are assumed to meet a Regulation D exemption for purchasing equity in private companies. I have yet to read a PPM written for a startup company that meets the parameters we angels generally establish for funding new ventures. Raising money'

Early Stage 79

Early Stage Accredited Investor SEC Private Placement 79

Lightspeed Venture Partners

OCTOBER 1, 2012

pre money valuation). Cuban has interest in a gluten free diet, and claimed that he liked the company, but his only concern was valuation. Since an early exit caps the upside potential, getting in at the right, low valuation is necessary to be able to make a high multiple on your investment. This would never happen in real life.

Pre-Money Valuation 152

Pre-Money Valuation Valuation Participating Preferred Preferred Stock 152