Gust

APRIL 9, 2014

Equity dilution works when the same pie is divided among more people. Over time, other people receive pieces of equity in exchange for work (employee stock options), money (seed, angel and venture investors), services (attorneys, directors, etc.). Uncategorized company equity dilution founder investors startup'

Dilution 150

Dilution Equity Vesting Stock Options 150

Gust

DECEMBER 15, 2013

Yet, according to many sources , over 90 percent of all businesses are started and grown with no equity financing, and many others would have been better off without it. In fact, most of the rich entrepreneurs you know actively turned away early equity proposals. Need expensive resources up front.

Bootstrapping 183

Bootstrapping Sweat Equity Entrepreneur Technical Review 183

Gust

OCTOBER 26, 2014

Bootstrapping avoids all the cost, pain, and distractions of finding angels or VCs, and allows you to keep control and all your hard-earned equity for yourself. Every outside hire increases your cost and risk. Hire experts, not help. Do it yourself. Network big to get connections and ideas, but do the work yourself.

Bootstrapping 176

Bootstrapping Startup Merger Salary 176

Gust

JULY 29, 2012

Don’t hire any employees. Barter your skills or equity for services you need. Exchanging equity for services is worth negotiating with legal counsel, accountants, engineers, and even sales people. You can’t be successful doing something you don’t enjoy. Consultants don’t need any inventory.

Bandwidth 155

Bandwidth Bootstrapping Equity Startup 155

Gust

JULY 12, 2012

It doesn’t give you more cash compensation, more equity ownership or more direct control over the operating business. The legal role of the board is to make strategic and corporate-level decisions, hire/fire the CEO, and represent all of the stockholders of the company.

Cofounder 107

Cofounder Founder Warrant Equity 107

Gust

DECEMBER 8, 2013

The intent of this question is to determine the level of commitment of founders, both cash and “sweat equity,” and how much others have already invested into this plan. They should be asking to speak to you if you are a potential investor or a superstar hire. How much “skin” is already in the game?

Due Diligence 174

Due Diligence Sweat Equity Intellectual Property Burn Rate 174

Gust

NOVEMBER 4, 2011

In brief, a cap acts to place a limit on the conversion price of a convertible note such that investors are guaranteed a minimum number of shares for their bridge loans if the startup does a priced equity round at a high pre-money valuation – “high” meaning above the cap, which is often a heavily negotiated term. (The of MySpace, Inc.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98