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The Legal Side of Entrepreneurship

YoungUpstarts

They also need to decide whether to structure terms as an equity deal or a convertible security deal. ” The Cost of Financing. .” ” The Cost of Financing. Startups bear the costs of their financing, from the first seed investment to the sale of Series A stock. Even $15-20,000 is too expensive.

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More Tech Startups are LLCs

Austin Startup

Background Reading: When LLCs Make Sense for Startups Not Building a Unicorn If you have spent almost any time reading about the basics of startup legal issues, you know that Delaware C-corps are the default organizational structure for a “classic” tech startup (software, hardware) planning to raise angel/VC money and scale.

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How to Work with Lawyers at a Startup

Both Sides of the Table

You never got around to agreeing exact equity splits but you had many conversations about it. Founded it as a California LLC but your potential VC wants a Delaware C-Corp? How to manage costs - One of the biggest frustrations that people have with lawyers are unexpected costs. Shame about that pesky FAS 157 ruling.

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Flexible VCs With Structures Between Equity and Revenue-Based Investing

David Teten

V: Should you raise venture capital from a traditional equity VC or a Revenue-Based Investing VC? VI: Revenue-based financing: The next step for private equity and early-stage investment. VIII: The Leading Flexible VCs, With Structures Between Equity and Revenue-Based Investing. We plan to raise $2.5m

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8 Reasons To Incorporate Your New Company Early

Startup Professionals Musings

It’s very easy and inexpensive to set up online a Limited Liability Company (LLC) for the startup, which will allow you to track business costs, cash and taxes correctly -- no matter what happens. Co-founder and equity negotiations work best if you own all the equity.

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Incorporate before pitching to VC’s?

Gust

That is, if all you have is a good idea, the reality is that you are highly unlikely to be able to get funding from anyone at all, even if you are a Delaware C corporation with gilt edge stock certificates.

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Do It Right The First Time, Part II: Visit the Doctor or House Call?

Gust

Readers can anticipate my next point in continuing the analogy: It makes no more sense for a non-lawyer to prepare fundamental legal, governance, equity and intellectual property documents than it would for a patient to self-diagnose and begin taking prescription-strength antibiotics or other medications. Newco, Inc.”)