Steve Blank

APRIL 26, 2022

Cram downs are back – and I’m keeping a list. Except, that is, for the bottom feeders of the Venture Capital business – investors who “ cram down ” their companies. A cram down is different than a down round. Cram downs wouldn’t exist without the founder’s agreement. Stopping Cram Downs.

Cram Down 404

Cram Down Founder Venture Capital Recapitalization 404

Startup Professionals Musings

JUNE 2, 2013

No VC or Angel investors I know are interested in a bunch of angry, crammed-down small investors as co-shareholders. Most investors like the idea of adding venture investments to “diversity their portfolio,” and create great up-side potential.

Cram Down 269

Cram Down Angel Investor Intellectual Property Venture Capital 269

Both Sides of the Table

APRIL 20, 2011

One example is that they introduced a program where their founders can pool together shares from their company and exchange them for a small portfolio of other First Round Capital companies. He also says it is important to be able to participate in follow on rounds so as not to get “crammed down”. Investor Involvement.

Pre-Money Valuation 284

Pre-Money Valuation Technical Review Cofounder Cram Down 284

Rob Go

SEPTEMBER 2, 2014

Getting Crammed Down. If a), you reduce the cram-down risk, but also reduce the fund’s upside because you own less of your portfolio companies to begin with. These platforms are really interesting to seed funds because they are simultaneously a threat, a weapon, and a sourcing mechanism.

Cram Down 66

Cram Down Institutional Investors Dilution Seed Stage 66

A Crowded Space

MAY 31, 2016

We expect there to be an increase in down rounds, flat rounds, inside rounds and various pay-to-play scenarios. Many VCs we talk with fear that their portfolio is at risk and they have switched gears to encourage companies to cut burn and get to cash flow positive. A 5% equity stake could get cut down to 1%.

Cram Down 60

Cram Down Pay to Play Angel Investor Warrant 60

Growthink Blog

MAY 23, 2011

As a result, the VC will often block a portfolio company from harvesting a very attractive, but not home run, return. In practice, this creates a significant incentive for the general partners to hold on for an extremely large investment return, and to be reasonably indifferent regarding smaller (less than 3x returns).

Angel Investor 112

Angel Investor Venture Capital Sweat Equity Cram Down 112