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Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

Term-sheets for preferred stock offerings are designed to protect the investor in case things don’t go as well as planned. Second a liquidation preference and a participation. A liquidation preference means that the investors receive their investment back (plus dividends) prior to a distribution of the proceeds to stockholders.

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The Ultimate Guide to Starting a Software Company

Up and Running

If you’re working closely with partners who are helping you distribute your product, it’s especially important to make sure they understand who you are, how you speak, and who you serve. Delaware law gives preferred stock investors of a corporation certain voting rights and control over the corporation.

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What is an employee retention or M&A carveout plan?

Startup Company Lawyer

Due to aggregate liquidation preferences that may exceed the acquisition price in an M&A deal, common stock may be rendered worthless. If you can’t figure this out yourself, you should probably build a liquidation preference spreadsheet to model how liquidation preferences work depending on M&A transaction value.

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Startup Resources

www.vccafe.com

Startup Metrics for Pirates â?? SaaS Metrics Tutorial â?? free, distributed source code control management system. Preferred Stock Purchase Agreement. Startup Foundry tools list. Small Business tools list. Lean Startup Circle â?? Google Group for startup advice. SEO and Analytics Tutorials. worth reading as well.