Remove Conversion Remove Convertible Security Remove Demand Remove Term Sheet
article thumbnail

What is convertible equity (or a convertible security)?

Startup Company Lawyer

Quick answer: convertible equity (or a convertible security) is convertible debt without the repayment feature at maturity or interest. Over the past few years, convertible debt has emerged as a quick and inexpensive method for startup companies to raise money from angel investors and early stage venture funds.

article thumbnail

The Legal Side of Entrepreneurship

YoungUpstarts

Investors typically negotiate from a term sheet, which if not handled properly can create problems that can hurt or kill the startup’s chances when they do their Series A round of funding. Entrepreneurs need to hit a happy medium with backers, not giving away too much but not making overly aggressive demands.