Growthink Blog

MAY 10, 2012

When seeking equity investments, the source of capital is, for the most part, tied to the stage of capital being raised. You see, equity capital is raised in stages or rounds. Mezzanine Financing Most companies that raise equity capital and are eventually acquired or go public receive multiple rounds of financing first.

Equity 88

Equity Mezzanine Later Stage Venture Capital 88

Startup Company Lawyer

MARCH 14, 2010

After the recent announcement of the Series Seed Financing documents by Marc Andreesen, Brad Feld points out that there are now four sets of “open source&# equity seed financing documents: TechStars Model Seed Funding Documents (by Cooley). Y Combinator Series AA Equity Financing Documents (by WSGR). under $500K).

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Both Sides of the Table

SEPTEMBER 5, 2012

This time by the efforts of Adeo Ressi to introduce a new kind of structure called “ convertible equity.” My initial reaction to Adeo when we spoke was that while it may have solved some issues (debt versus equity) it didn’t solve the ones that I’ve been warning entrepreneurs about most loudly.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

Gust

OCTOBER 5, 2011

Let’s dive in, taking it from the top: Type of Security : Convertible Promissory Notes, bearing interest at a simple interest rate of 8%. At least one well-known Silicon Valley venture accelerator is using a document referred to as a “ convertible security ” rather than “convertible promissory note.”

Finance 79

Finance Preferred Stock Term Sheet Early Stage 79

Scott Edward Walker

APRIL 9, 2012

ii) why are convertible notes issued instead of shares of common or preferred stock? Part 3 will cover certain special issues, such as (i) what happens if the startup is acquired prior to the note’s conversion to equity? (ii) ii) what happens if the maturity date is reached prior to the note’s conversion to equity?

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Preferred Stock Finance Common Stock Liquidation Preference 87

Business Plan Blog

NOVEMBER 13, 2013

Since investment in a startup is risky and most people are reluctant to contribute funds, startup entrepreneurs can use different ways to make funding from FFF look less risky. Convertible Debt” is a loan, which is automatically converted to equity at maturity or upon the closing of a round of financing. 3) Giving non-voting stock.

Finance 93

Finance Accredited Investor Angel Investor Seed Capital 93

Berkonomics

MAY 22, 2014

The sale of equity in private companies is regulated by the Securities Act of 1933, which requires that the company either register with the SEC or meet one of several exemptions (Regulation D). The entrepreneur may have already raised half or more of the cash required in this round and is eager to top off the round.

Early Stage 79

Early Stage Accredited Investor SEC Private Placement 79

Berkonomics

OCTOBER 1, 2015

Sometimes the end game or sale of the company is not a happy event for the early investors, including the entrepreneur or the founders. Most sophisticated investors will take either a promissory note or preferred stock, both of which come before founder or management stock in a sale or liquidation.

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Dividend Preferred Stock IRR Participating Preferred 48

Gust

MAY 24, 2012

Yet I’m skeptical that a widespread shift will occur anytime soon, and for reasons discussed below, as much as I admire and advocate for talented entrepreneurs, I believe it would be a losing proposition for nearly all involved. Options and warrants, when issued, are also typically exercisable for shares of Common Stock.

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IPO Equity Common Stock Stock 159

Gust

JULY 18, 2012

Yet I’ve rarely seen entrepreneurs more fired up than when recounting war stories of startups whose founders had control of the company wrested from them, were forced to take financing or compensation deals on outrageously onerous terms , or worst of all, fired from their own companies.

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Stock Options SEC Stock Government 188

Both Sides of the Table

SEPTEMBER 8, 2012

If you do a capped note it’s bad for the entrepreneur. It has both a “full rachet” and “multiple liquidation preferences.” There is simply no reason for the first angel to write you a check until you have the whole round secure, which is why people herd cats. You can do it with equity & a price.

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Pre-Money Valuation Finance Liquidation Preference Warrant 294

Board Effect

MAY 10, 2019

It’s important to note that the structure and contents of a cap table are unique to how a company has chosen to divide its equity. Cap tables are also used to model waterfalls and what-if scenarios, giving companies a better understanding of how different events might impact shareholder payouts and equity dilution.

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Cap Table Liquidation Preference Dilution Liquidity Event 40

Up and Running

MAY 23, 2016

To give you a better idea of what entrepreneurs in this industry are thinking about during each phase of the startup process, I interviewed SaaS entrepreneurs from all over the world, including our own COO Noah Parsons. Practical Market Research Resources for Entrepreneurs. How to Write a Business Plan in Under an Hour.

Software Review 74

Software Review Software Delaware Forecast 74

Gust

OCTOBER 3, 2011

For a first time entrepreneur trying to figure out the arcane world of startup financing, it can be very confusing to understand the roles that different types of investors play in funding promising companies, as well as the point in a company’s life at which they enter the stage. From +/- $1.5m

Finance 70

Finance Venture Capital Intellectual Property Early Stage 70

Gust

OCTOBER 26, 2011

When a company is asked to make legal representations about its standing, prior equity and debt issuances, corporate governance formalities and so forth, if taken seriously, matters of “deferred maintenance” often surface and must be handled before closing.

Finance 79

Finance Term Sheet Covenant Accredited Investor 79

techcrunch.com

SEPTEMBER 2, 2012

Convertible Equity, A Better Alternative To Convertible Debt? As a refresher, a convertible note is a loan that automatically converts into equity upon the closing of a Series A round of financing. In the end, Ressi says that Convertible Equity allows startups and investors to have their cake and eat it too. Smartphones.

Equity 87

Equity San Francisco Technical Review Angel Investor 87

Altgate

MARCH 16, 2009

.  So for the past few weeks I've been talking to venture capitalists, entrepreneurs, CEOs and other industry participants in these countries and learning a ton about the local startup ecosystems.   In India and China there is no preferred stock.   In India and China there is no preferred stock.

Global 28

Global India United Kingdom 28

www.vccafe.com

MARCH 11, 2013

A group of Seedcamp entrepreneurs started a startup tools wiki for that purpose, and we thought it would be well suited here. No need to worry about security and such. YCombinator Series AA Equity Financing Documents. List of Angel/SuperAngel Investors for entrepreneurs. Founder Equity Issues. Legal, Equity, etc.

Software Review 53

Software Review Technical Review Startup 53