Both Sides of the Table

JULY 23, 2014

The rise of “micro VCs” or seed-stage funds. Just 3 years ago there was talk of institutional investors “not being able to write small enough checks.” ” The new narrative is “will my seed funds be able to fund the prorata of their winners?” more than 5 years ago?—?and

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

K9 Ventures

MARCH 23, 2011

There has been a lot of noise in the Valley lately about how most seed stage deals are now being done as convertible notes. The convertible note was really intended as an instrument for a “bridge financing” – when an equity round was imminent, and likely to occur, but the company needed some money in between.

Pre-Money Valuation 132

Pre-Money Valuation Valuation Equity Liquidation Preference 132

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). A real institutional investor wants to invest $XX,000 in his company. I hope the investor agrees. Seems like a win-win.

Common Stock 45

Common Stock Stock Cap Table Preferred Stock 45

Austin Startup

MAY 17, 2017

Angels / Seed Funds who write larger checks may want a deeper view into what’s going on in the company. They’ll often ask for different variants of ‘information rights’ — which can include delivery of regular financials, and notification of major transactions (like financings). Giving seed stage investors Board seats is not the norm.

Seed Stage 48

Seed Stage Startup Cap Table Angel Investor 48