Startup Professionals Musings

AUGUST 10, 2019

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Hunter Walker

FEBRUARY 20, 2021

You don’t even need to do anything and we’ll give you equity. You see, the demand for “startup advisors” were going through a little bit of a boomlet. It doesn’t have to be a huge commitment on their part (or significant equity), but just start giving them some tie to your startup and some incentive to maintain the relationship.

Advisory Board 150

Advisory Board Equity Vesting Startup 150

David Teten

SEPTEMBER 2, 2017

It’s hard enough to get a job at a venture capital or private equity firm; it’s even more complex to join as a Partner. Also see Preqin’s Key Due Diligence Considerations for Private Equity Investors. . VC and private equity are very illiquid on both the investing and the personnel side. So assessing fit is critical.

Private Equity 60

Private Equity Venture Capital Equity Partner 60

Startup Professionals Musings

MAY 18, 2015

This is the purpose of a vesting schedule, which issues allocated stock over time. Typically, vesting in startups occurs monthly over four years, starting with the first 25 percent of shares vesting only after an owner has remained active for at least 12 months (one year cliff ). Key founder vesting should have no cliff.

Stock 120

Stock Vesting Common Stock Founder Vesting 120

Growthink Blog

MARCH 19, 2012

Letting small companies sell equity stakes online would be a huge boost to those firms—like angel investing on steroids. Broadening the Base Currently, equity-based crowd funding falls under strict Securities and Exchange Commission rules governing angel investing. That hinders broad-based online fund raising in a couple of ways.

Equity 88

Equity Securities and Exchange Commission Private Equity SEC 88

Startup Professionals Musings

DECEMBER 14, 2014

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Startup Professionals Musings

AUGUST 19, 2017

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

Startup Professionals Musings

JULY 19, 2013

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

The Startup Toolkit

AUGUST 29, 2012

4 year vesting, full acceleration on exit, optional cliff. 2%, you treat advisor equity just like founder or employee equity: vested over 4 years. if the company is sold, they get their entire stake immediately, whereas the founders often have to start a new vesting period in the terms of the acquisition).

Equity 46

Equity Vesting Advisory Board Merger 46

The Startup Lawyer

MARCH 17, 2012

With the surge in demand for technical co-founders, many startups have no choice but to contract with dev shops to build their idea. Therefore, be sure that equity compensation in exchange for dev shop services is “small” and granted or vest according to a milestone schedule.

Cofounder 92

Cofounder Vesting Equity Agile 92

Austin Startup

AUGUST 20, 2017

They’re looking to be paid properly in the context of the overall salary structure, including cash, benefits, and equity, and to be paid commensurate with performance. Set any vesting schedules and expiration dates on roughly similar terms, if for no other reason just so you can track all of them correctly.

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

infochachkie.com

SEPTEMBER 24, 2011

Instead of hearing from your long lost third-cousin, you will be inundated with an avalanche of ‘congratulatory’ emails, calls and letters from people who want to relieve you of the burden of your hard-earned equity round. Given all the demands on your time, the hours spent educating a consultant regarding your business are costly.

Equity 40

Equity Silicon Valley Cofounder Technical Review 40

David Teten

DECEMBER 3, 2019

Private equity and venture capital investors are copying our sisters in the hedge fund world: we’re trying to automate more of our job. . In the private equity universe, most Partners have primary training as deal-makers, not as managers. (To see the video above, please click the image, and then click on the Play button.).

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Startup Professionals Musings

APRIL 19, 2010

Later, when your venture is trying to close on financing, or even going public, that forgotten partner surfaces, demanding equity. This problem can be avoided by incorporating immediately after early discussions, and issuing shares to the founders, with normal vesting and other participation rules.

Non-Compete 125

Non-Compete Accredited Investor Startup Cofounder 125

Tim Keane

JANUARY 12, 2010

The investors and the entrepreneurs are – or should be – aware that the price of the company’s equity is set by the market – in simplest terms, what an informed buyer is willing to pay.   Note that this applies only to earl stage Series A-type equity financings and assumes no cash dividends are paid to investors.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Duct Tape Marketing

SEPTEMBER 30, 2022

John Jantsch (01:11): So that's a lot in the CMOs job, particularly diversity, equity, inclusion. There is absolutely a need and a place for new business development, the typical demand gen motions, you know, to kind of Google search and all the other things that you might be doing. So Carrie, welcome to the show.

Marketing 76

Marketing Differentiation B2C PR 76

Diego Basch

JUNE 21, 2012

Because they will keep 20% equity each at the time of the acquisition, that means $6M each before taxes and vesting. Shareholders demand it! Now that Joe and Wayne have solved their money problem, maybe they will want to create some world-changing stuff after some resting-and-vesting. In other words, money problem solved.

Silicon Valley 78

Silicon Valley Las Vegas San Francisco Vesting 78

www.quora.com

SEPTEMBER 22, 2011

Type to Add and Search Questions; Search Topics and People Startups Startup Compensation Entrepreneurship Compensation Stock Options Major Internet Companies Silicon Valley Why is there such a large founder to early employee equity drop-off? This ties into this Paul Graham article: [link] /equity. I'm always su. This answer.

Equity 40

Equity Employee Founder Cofounder 40

K9 Ventures

NOVEMBER 21, 2011

And that too usually when there is sufficient investor demand for the next round, i.e. the leverage needs to be in the company’s hand (rather than investors) for any type of founder liquidity to even be an option. I believe this is something that needs to be determined on a company-by-company basis.

Founder 87

Founder Common Stock Preferred Stock Stock 87

The Startup Lawyer

MARCH 11, 2010

For example, a founder stock purchase agreement is 12+ pages long because founders can, have, and will fail and/or bail on startups (hence the vesting schedule & startup repurchase option). There will always be demand for good counsel. While the practice of startup law isn’t rocket science, it is nevertheless complex.

Delaware 49

Delaware Hockey Stick Preferred Stock Open Source 49

K9 Ventures

NOVEMBER 21, 2011

And that too usually when there is sufficient investor demand for the next round, i.e. the leverage needs to be in the company’s hand (rather than investors) for any type of founder liquidity to even be an option. I believe this is something that needs to be determined on a company-by-company basis.

Founder 84

Founder Common Stock Preferred Stock Stock 84

The Startup Lawyer

MARCH 11, 2010

For example, a founder stock purchase agreement is 12+ pages long because founders can, have, and will fail and/or bail on startups (hence the vesting schedule & startup repurchase option). There will always be demand for good counsel. While the practice of startup law isn’t rocket science, it is nevertheless complex.

Delaware 45

Delaware Hockey Stick Preferred Stock Open Source 45

Both Sides of the Table

MAY 5, 2011

It’s clear that America has a vested interest in promoting entrepreneurship in many regions in the country to stimulate innovation & job creation. on to their next companies and that produced Demand Media, a public company who even with a slight recent reduction in share price is still trading at $1.3 We know it can be done.

Seattle 317

Seattle Silicon Valley Technical Review Los Angeles 317

www.paulgraham.com

APRIL 28, 2010

A lawyer I asked about it said: When the company goes public, the SEC will carefully study all prior issuances of stock by the company and demand that it take immediate action to cure any past violations of securities laws. vesting would in that situation force founders to toe the line. At Viaweb we managed to raise $2.5

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

maplebutter.com

JANUARY 8, 2013

Ideally you can pay them based + equity so that you’ll get their attention and focus on the project. Then decide if you can build more value on either end of that process to demand a higher premium. There’s no formula however I do know … the more you build before you need to hire / partner, the more equity you can keep.

Technical Review 44

Technical Review Startup Cofounder Software Review 44

www.chubbybrain.com

SEPTEMBER 28, 2011

Go vest yourself. Don’t exacerbate the issue by needing to figure out how to deal with a large equity deadweight on your hands (investors won’t like that the #2 stakeholder is absent, even estranged, from your company). Believing that any startup won’t have to deal with stock vesting issues is totally unrealistic.

Software Review 79

Software Review Startup Technical Review Vesting 79

Both Sides of the Table

FEBRUARY 14, 2016

” “Mark has a vested interest in talking down valuations of startups.” The Laws of Supply & Demand. The most basic chart of microeconomics is a supply & demand curve. Demand represents a buyer and supply a seller. In economics we call this a “demand curve shift” as outlined below.

Valuation 150

Valuation Down Round Startup Later Stage 150

Startup Professionals Musings

NOVEMBER 8, 2010

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. Another common “failure to start” situation I see is one where the “idea person” insists that the idea is 90% of the value (and 90% of the equity). The same logic applies to splitting equity with co-founders.

Equity 228

Equity Intellectual Property Cofounder CTO Hire 228

www.chubbybrain.com

SEPTEMBER 28, 2011

Don’t exacerbate the issue by needing to figure out how to deal with large equity deadweight on your hands (investors won’t like that the #2 stakeholder is absent, even estranged, from your company). So, the best way of dealing with this issue is to take a long, long vesting period for all major sweat equity founders.”.

Cofounder 89

Cofounder Startup Technical Cofounder CTO Hire 89

Startup Professionals Musings

APRIL 23, 2012

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. Another common “failure to start” situation I see is one where the “idea person” insists that the idea is 90% of the value (and 90% of the equity). The same logic applies to splitting equity with co-founders.

Intellectual Property 252

Intellectual Property Equity Cofounder CTO Hire 252

www.readwriteweb.com

FEBRUARY 23, 2010

4: Demand Excellence : Ensure staff are committed to and understand your vision. 5: Raising Money : The higher your evaluation is, the more equity you have to work with. Posted by: GUCCISTORE | August 22, 2010 9:19 AM to be honest, i like 5: Raising Money: The higher your evaluation is, the more equity you have to work with.

Entrepreneur 69

Entrepreneur Venture Capital San Francisco New Zealand 69