VCs have an unfair advantage when it comes to financings.  typical start-up company will do 2-4 venture capital financings before a successful exit (or, conversely, an ignomious ending).  In contrast, the typical venture capitalist, either individually or across their partnership, will do 5-10 financings in any given year.  MORE >>

Once you have a potential investor excited about your team, your product, and your company, the investor will inevitably ask “What is your company’s valuation?” How much is NewCo worth to investors at this point (pre-money valuation)? This is the most concrete valuation element, usually called the asset approach. MORE >>

Once you have a potential investor excited about your team, your product, and your company, the investor will inevitably ask “What is your company’s valuation?” How much is NewCo worth to investors at this point (pre-money valuation)? This is the most concrete valuation element, usually called the asset approach. MORE >>

Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. As the company grows and the second or third group of investors comes in, the terms of each subsequent financing grow in size, scope, and the number of lawyers’ fingerprints on them. Seat on the board. MORE >>

compensate the angel for the early risk), the convertible promissory note will have an automatic conversion discount feature by which the angel investor will exchange the convertible debt for shares of the Series A Preferred Stock at a discount to the price per share paid by the venture capital fund at a Qualified Financing. per share. MORE >>