Gust

APRIL 11, 2014

Let’s get right down to business: Dilution of founders’ and other early shareholders’ equity in startups is frequently a subject of intense interest and debate. Yet what matters fundamentally is economic dilution : Will adding newly issued shares make existing shares less valuable, and if so, by how much?

Dilution 162

Dilution Equity Prospectus Pre-Money Valuation 162

Startup Professionals Musings

APRIL 19, 2010

Although every startup is unique, there are certain common avoidable mistakes that can lead to legal complications which jeopardize the long-term success of the business. Here are some examples: Failure to document a founder agreement at the beginning. This shortcut can lead to the so-called “forgotten founder” problem.

Non-Compete 125

Non-Compete Accredited Investor Startup Cofounder 125

Scott Edward Walker

MAY 15, 2012

Part 2, entitled “ Convertible Note Seed Financings: Econ 101 for Founders ,” addressed the economics. This part will address certain tricky issues. What Happens If a Startup is Acquired Prior to the Note’s Conversion to Shares of Preferred Stock? This post was originally published on TechCrunch.]

Finance 64

Finance Founder Accredited Investor Preferred Stock 64

The Startup Lawyer

JANUARY 26, 2010

Now if your startup received a $5MM Series A investment from a venture capital firm, how many developers (that you can recall) would come out of the shadows of the internet and claim to be your startup’s long lost founder? The answer to this question depends on how well your startup secures its intellectual property.

IP 57

IP Intellectual Property Founder Stock Options 57

Scott Edward Walker

APRIL 22, 2012

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? and (ii) what happens if the maturity date is reached prior to the note’s conversion to equity? Specifically, a cap is a ceiling on the value of the startup (i.e.,

Pre-Money Valuation 72

Pre-Money Valuation Finance Liquidation Preference Founder 72

Scott Edward Walker

APRIL 9, 2012

Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook. ii) what happens if the maturity date is reached prior to the note’s conversion to equity? (ii)

Preferred Stock 87

Preferred Stock Finance Common Stock Liquidation Preference 87

www.mattbartus.com

DECEMBER 9, 2012

Perspectives on issues affecting founders, startups and investors from a veteran startup lawyer in Silicon Valley. If you are a company that is fundraising, keep in mind that there are a few different levers you can pull to change the amount of dilution that the founders will experience. — 23 Comments.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40