Both Sides of the Table

MAY 9, 2018

I then had to review a nefarious IP lawsuit filed against another company and help the CEO figure out whether we should just pay it or join forces with the other companies named and fight it. I left the meeting and had to attend a 3-hour board meeting where two founders have been fighting and each want the other one fired. You’re in control.

Software Review 381

Software Review Churn Rate Due Diligence New York 381

View from Seed

DECEMBER 4, 2014

Editor’s note: Understanding how to divide founder equity at a startup can be tricky, even to the point of reaching emotional riffs between founders. Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits.

Equity 315

Equity Founder Sweat Equity Cofounder 315

Agile VC

DECEMBER 4, 2014

Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. But delaying or avoiding the conversation often results in it being more awkward than it needs to be.

Cofounder 255

Cofounder Equity Founder Sweat Equity 255

Agile VC

DECEMBER 4, 2014

Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. But delaying or avoiding the conversation often results in it being more awkward than it needs to be.

Cofounder 173

Cofounder Equity Founder Sweat Equity 173

Both Sides of the Table

JUNE 5, 2015

Over the years I’ve written extensively about the downsides of convertible notes for startups such as here , here and here. How much is in the option pool? If you have 8 senior managers in place and I don’t think you’ll need as many people I might accept an option pool of 8% unallocated.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Tim Keane

JANUARY 12, 2010

Startups and angels: Along the way to success.   This is perceived by some investors as a way to assure that the founders are in the game for the long run. ·       Conversion provisions allowing preferred to convert to common if they choose or upon the closing of an IPO at a specified price.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Hippoland

APRIL 10, 2016

Ada is my professor, and we are using her lab, and the company is based on her research, though the IP is assigned to the company. But, Ada wants to split the equity 50% her, 20% Bob and 20% me with a 10% option pool. This will be a terribly difficult conversation, and you may need to move labs immediately.

Cofounder 48

Cofounder Cap Table Equity Vesting 48