Gust

MAY 24, 2012

Options and warrants, when issued, are also typically exercisable for shares of Common Stock. By contrast, venture capital and angel investments normally take the form of Preferred Stock with rights and preferences set forth in the company’s Certificate of Incorporation and other governance documents.

IPO 159

IPO Equity Common Stock Stock 159

YoungUpstarts

AUGUST 25, 2015

Stocks are issued at the time the company is formed, and more can be issued over time. You can control the power of your company’s stock by issuing different classes. Investors/buyers may even ask that the company be restructured. The ownership structure of an LLC is a blank slate. Verdict : Corporation.

LLC 100

LLC Technical Review Software Review Limited Liability Company 100

Hunter Walker

SEPTEMBER 29, 2022

We started by asking our LPs (a relatively small number of institutional investors) and other experienced VCs what they’ve seen play out and how, if applicable, they decide what to do with their own holdings. All the preferred stock is pari passu and behaving honorably in the best interest of the company?

Venture Capital 122

Venture Capital Cap Table LP Equity 122

ithacaVC

DECEMBER 22, 2012

And there are some angel investors that know that even with “light” preferred stock terms (sometimes called Series Seed), there is enough control built into the terms of the preferred stock that the company is still mostly restricted when it comes to making key decisions. Fair point.

Seed Stage 82

Seed Stage Preferred Stock Founder Angel Investor 82

K9 Ventures

MAY 14, 2011

This in theory is very similar to the behavior of institutional investors, however, there is one big difference. Institutional investors make sizable investments in a company, so that when they do get a big hit that can make the whole fund. Common Stock. Convertible Note or Preferred Stock.

Preferred Stock 125

Preferred Stock Seed Stage Incubator Early Stage 125

Startup Company Lawyer

MARCH 12, 2009

Any company that raises venture financing will need to be a C corp in order to issue preferred stock. Most venture and institutional investors favor C corps because they may have separate classes of stock, allowing for the creation of various levels of preferences, protections, and share valuations.

LLC 61

LLC Stock Options Preferred Stock Stock 61

ithacaVC

APRIL 5, 2011

One rule of simple cap tables is to issue “normal” stock to founders (common stock only) and investors (typically preferred stock, but sometimes common stock to early friends and family). A real institutional investor wants to invest $XX,000 in his company.

Common Stock 45

Common Stock Stock Cap Table Preferred Stock 45