Startup Professionals Musings

APRIL 10, 2016

Early stage burn rates over $50K per month, or a runway of less than six months may indicate an inefficient or desperate startup. Every startup should have at least a couple of outside advisors who are not major investors or family members, anxious to talk to new investors and key new hires. Think twice before you jump in.

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

Hunter Walker

JULY 2, 2022

Most hiring processes start with an antiquated assumption that companies select people to work for them. So what are some ways that early stage startups can reduce the odds of a newly signed team member becoming regretted attrition before they’ve even signed into their corporate email? Involve Their Family/Partners.

Hiring 93

Hiring Vesting Early Stage Stock 93

Startup Professionals Musings

APRIL 8, 2015

Early stage burn rates over $50K per month, or a runway of less than six months may indicate an inefficient or desperate startup. Every startup should have at least a couple of outside advisors who are not major investors or family members, anxious to talk to new investors and key new hires. Think twice before you jump in.

Technical Review 120

Technical Review Due Diligence Sweat Equity Burn Rate 120

NZ Entrepreneur

SEPTEMBER 29, 2021

experiments to build a product, find customers, test business models and hire amazing people. It is not uncommon for startup directors to be more deeply involved in the operations of the business when the company is entering a new market, hiring critical team members or raising capital. This equity will vest over 2-3 years.

Technical Review 88

Technical Review Software Review New Zealand Due Diligence 88

Up and Running

DECEMBER 1, 2015

Stock options are issued to employees usually through an Employee Stock Option Plan (ESOP) and include what is called a “vesting period.” The vesting period, often three or four years, frees up a percentage of the options for the employee to purchase the longer they stay at the company. See Also: How to Hire Your First Employee.

Equity 60

Equity Employee Stock Options Vesting 60

crowdSPRING Blog

JULY 1, 2011

How to Hire a Graphic Designer – [link]. How to Hire a Graphic Designer – [link]. Interesting but punitive provision in Skype’s option plan allowing repurchase of even vested options at grant price – [link]. 10 Marketing Lessons for Early-Stage Tech Startups - [link].

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Social Media Small Business Design Media 92

The Next Web

AUGUST 26, 2013

Today, in steps 10-12 I want to discuss with you raising your first round of money, hiring to develop and maintain your company culture, as well as defining your role in the management of your startup. Before you start talking to large VCs, find some early stage investors. But never give away shares without vesting.

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Management Cofounder Startup Bootstrapping 120

Eric Friedman

JANUARY 23, 2022

I finalized my notes for the ODX Accelerator program, the early stage accelerator I am building at On Deck , and I wanted to summarize here. I love the start of programs, when teams are excited – all at the earliest stages of company creation. What equity you give early stage advisors matters. Fundraising.

Early Stage 78

Early Stage Equity .Net Vesting 78

The Startup Magazine

OCTOBER 30, 2018

In addition, getting a tax lawyer on retainer in the early stages of your business will benefit you down the road, as they will have a better understanding of your business’s roots and history. Therefore, it’s often a good idea to hire a contract lawyer to have on retainer. Contract Lawyer. Intellectual Property Lawyer.

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Intellectual Property Idaho Entrepreneur IP 99

Hunter Walker

FEBRUARY 20, 2021

That said, there are three types of advisors that I don’t see as commonly utilized by early stage startups — at least the ones we’re not advising. I’m a big proponent of startups hiring talented high-ceiling people who are earlier in their careers and haven’t necessarily yet done the job they’re being recruited for. Let me know!

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Advisory Board Equity Vesting Startup 150

Both Sides of the Table

MAY 9, 2011

Hire your co-founder. Vested over 4 years. Involve them in fund raising, hiring, strategy, etc. Most senior employees who join are given 2% if they join early. Maybe they get up to 10% if they joined REALLY early and were senior. I wrote about many of the early-stage startup mistakes here.

Cofounder 393

Cofounder Founder Vesting Founder Vesting 393

Steve Blank

JUNE 15, 2010

Will they tailor your vesting to your contribution as a founder? What Startup Stage Do they Invest In? Ask potential investors which stage they invest in. Certain VC’s like the new class of Super-Angels and small VC funds specialize in the early stage of a startup where you are searching for a business model.

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Founder Vesting Later Stage Early Stage 231

Steve Blank

JULY 19, 2010

As a founder I fought with VC’s over vesting as they brought in a new CEO and walked me out the door. As a board member I negotiated with founding CEO’s over vesting when I thought it was their time to go. They also know that most founding CEO’s don’t scale past the early stage. That’s the source of the trouble.

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Vesting Liquidity Event Venture Capital Founder Vesting 251

techcrunch.com

JUNE 22, 2012

Having to invent ad hoc terms to work together, negotiating terms, and throwing money into hiring lawyers can really hamstring the formation of productive founder-advisor relationships — something that can really make or break a startup in its early stages.

Equity 94

Equity San Francisco Startup Silicon Valley 94

Gust

APRIL 9, 2014

Therefore, to avoid dilution to its existing equity holders, all a company has to do is not hire any more employees who get options, or take any more money from investors.

Dilution 150

Dilution Equity Vesting Stock Options 150

Both Sides of the Table

MAY 13, 2013

For the past 5 years or so Google, Facebook and a handful of tech industry giants have been quietly buying scores of early-stage startups for their talent. Chief Vesting Officers)? The Aqui-hire Business. Many buying companies price these deals on the basis of $1 million per engineer on the team for an early-stage deal.

Liquidation Preference 357

Liquidation Preference Early Stage Retention Lock-up Period 357

Austin Startup

AUGUST 20, 2017

Early stage startups have to survive one day at a time and are often presented with limited choices of the moment that enable them to continue. Hiring is a chapter unto itself, but it deserves to lead off any discussion of context. Compensation decisions obviously affect hiring and retention.

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

Up and Running

FEBRUARY 19, 2014

To learn some common legal pitfalls we’d all be better off avoiding, we asked nine founders from the Young Entrepreneur Council (YEC) what unexpected things they found themselves needing lawyers for in the early stages of their startups. Have you hired or not hired a lawyer for your startup, and why? Immigration.

Non-disclosure Agreement 97

Non-disclosure Agreement NDA Term Sheet Early Stage 97

Both Sides of the Table

FEBRUARY 14, 2018

Safe Space I know that people can hear a term like “safe space” and make assumptions about what that might mean but the truth is that first-time founders really do need a safe space to make mistakes, ask dumb questions, learn & interact with peers and get advice from mentors who have a vested interested in helping them succeed.

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Founder San Francisco Deal Flow Los Angeles 256

www.instigatorblog.com

OCTOBER 23, 2010

Changing Equity Structures for Early Startup Employees Tweet Recently someone asked me for advice on how much equity they should give to their early employees. His company had just closed an early round of funding and he wanted to cement the employee relationships. But I also told him that I though the numbers were wrong. .&#

Equity 41

Equity Employee Startup Vesting 41

Genuine VC

FEBRUARY 28, 2011

At a board level, VCs and other members don’t like to see someone recently hired already receiving new options or a salary raise after a short period of time. The board’s bias will be to spend those resources on hiring new talent or to retain those who have worked at the company longer and harder. Early-Stage.

Startup 121

Startup Equity Vesting Salary 121

This is going to be BIG.

APRIL 16, 2018

First, in the early stages, there's a lot more information that can be gleaned about you than we can know for sure about the success of your company. Given that so much of the bet at these early stages, even at the Series A comes down more to "Do I believe what this founder believes?" Well, it all depends, right?

Due Diligence 74

Due Diligence Early Stage Term Sheet Vesting 74

Austin Startup

SEPTEMBER 19, 2017

A strong advisor can walk you in the door to the same number of companies as 2–3 new sales hires. The more disruptive an idea, the harder it is the evaluate at an early stage. in company equity is normal at this stage, with the higher end of the range reserved for leaders of industry who bring more to the table than connections.

Advisory Board 48

Advisory Board Sweat Equity Marketing Vertical 48

www.payne.org

SEPTEMBER 22, 2011

4 Vesting. The re-heating of the venture funded tech market has pushed a heat up of the hiring market, and Im getting more calls from friends asking for help understanding startup stock (equity) offers. The total preference is less of an issue in early stage companies (e.g. From Payne.org Wiki. 3 Dilution. References.

Equity 56

Equity Employee Vesting Preferred Stock 56

Berkonomics

SEPTEMBER 28, 2017

And then there are options: [Email readers, continue here…] Stock options or phantom stock are the tools of early stage businesses used to attract great talent when there is not enough cash to pay market rates. Options typically are earned over time, which we call vesting. There are some rules.

Early Stage 102

Early Stage Equity Stock Options Vesting 102

infochachkie.com

SEPTEMBER 24, 2011

At the early stages of your company’s life, you cannot rely on disinterested, hired guns to define your company’s key tasks. John is currently a partner at Rincon Venture Partners , a venture capital firm investing in early stage web-based businesses, and is a Co-Founder of RevUpNet , a performance-based online marketing agency.

Equity 40

Equity Silicon Valley Cofounder Technical Review 40

The Next Web

OCTOBER 7, 2013

They were referring to non-founder engineers, most commonly the first hire for technology businesses. However, at the very early stage, they are taking as much risk with their future as the founders. After a year, shares will vest in monthly or quarterly splits until the full grant is vested. Engineer #1?

Engineer 129

Engineer Dilution Option Pool Vesting 129

Berkonomics

NOVEMBER 23, 2023

and here is the usual early-stage trap… First, a brand-new enterprise is often formed from the efforts of several “partners”, each with an expertise valued by the others. How about “vesting” shares over time ? Options typically are earned over time, which we call vesting. Here are some rules.

Equity 62

Equity Stock Options Vesting Early Stage 62

This is going to be BIG.

SEPTEMBER 13, 2012

When the law becomes so complicated that only a select few with the money to hire lawyers can translate and manipulate it, you give a tremendous advantage to those already in power. It's a set of rules regulating a system can only be understood and changed by those who built the system.

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Open Source Framework Vesting Community 123

techcrunch.com

FEBRUARY 25, 2010

This is probably why investors’ case for a company to sell early f ocuses exclusively on the founder : in most early-stage acquisitions, the liquidation preferences and deal-sweeteners only work for investors and founders. Why aren’t we surprised when three months later that company can’t hire enough engineers?

Liquidation Preference 63

Liquidation Preference Founder Option Pool Acquisition 63

David Teten

OCTOBER 1, 2015

I recently joined CoVenture , an early-stage venture capital firm that develops products and invests cash in exchange for equity. My comments here relate mostly to new or early-stage startups, as I’ve spent most of my career investing in those companies and it’s what we do at CoVenture. 5% vest at clickable prototype.

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

Both Sides of the Table

MAY 7, 2016

My internal compass says that “country-club” entrepreneurs struggle to make as big of an impact because it’s really hard to totally change a system that you’re part of and have a vested interest in. So positive chips are a great signal for me. But chips come in multiple flavors and it’s a fine line between positive and negative.

Churn Rate 150

Churn Rate Vesting Dilution Europe 150

David Teten

DECEMBER 3, 2019

Data companies focused on early-stage startups include Aingel , fundsUP , Preseries , PredictLeads , and Sploda. The Pocket Negotiator is very early-stage attempt to aid in the negotiating process itself. ff Venture Capital hired two full-time engineers to build out Totem. Fincura specializes in serving lenders.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Berkonomics

MAY 12, 2010

If there are 85,000 shares issued to the founders, then a plan calling for 15,000 shares in a pool reserved for future hires is appropriate, making the fully diluted shares 100,000. We will cover board members and advisory board members at a later time. . Options typically are earned over time, which we call vesting.

Early Stage 85

Early Stage Equity Stock Options Vesting 85

www.paulgraham.com

APRIL 28, 2010

4 ] Seed Funding Firms Seed firms are like angels in that they invest relatively smallamounts at early stages, but like VCs in that theyre companiesthat do it as a business, rather than individuals making occasionalinvestments on the side. Angels and even VC firms occasionally do this, but they alsoinvest at later stages.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

Both Sides of the Table

MAY 5, 2011

Your highest priority right now is hiring the 1 or 2 people that are going to join your company and make a difference. Chris Devore & Andy Sack have created Founder’s Coop with the goal of funding, incubating & launching more early-stage ventures in Seattle. There’s you and your killer CTO co-founder.

Seattle 317

Seattle Silicon Valley Technical Review Los Angeles 317

venturehacks.com

SEPTEMBER 22, 2011

In practice, you raise money or hire an employee because you need to, not because you want to. Say the equity equation tells you to pay a prospective hire above market. You should still pay the hire a market rate and save the company some equity. Say the equity equation tells you to pay a prospective hire below market.

Equity 40

Equity Cap Table Valuation RSS 40