Scott Edward Walker

OCTOBER 19, 2020

Over the past six months, my firm has been engaged by a number of startups with significant intellectual property (“IP”) problems. In a couple of cases, the founders played lawyer on their own; in the other cases, the founders either used (i) a Web service that did not address IP issues or (ii) an inexperienced law firm.

IP 52

IP Software Review Founder Technical Review 52

Scott Edward Walker

SEPTEMBER 28, 2011

Vesting Restrictions. The first deadly mistake relates to vesting restrictions. In addition, sometimes a portion of the shares will be deemed to be vested “up front” – meaning that they are not subject to vesting — particularly where a founder has made a significant contribution prior to the company’s incorporation.

Vesting 89

Vesting Software Review IP Intellectual Property 89

Both Sides of the Table

SEPTEMBER 18, 2014

Revenue multiple? If you’re wildly successful early on or if they help you achieve a great valuation they actually pay a significant price for their eventual stock even though they took much more risk than a future investor and backed you early. Less than you’ll probably grant your most junior employees in stock options?

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Scott Edward Walker

NOVEMBER 2, 2011

Set-up vesting schedules for the founders (see post here ) and file 83(b) elections with the IRS (see #3 here ). Button-down IP ownership and assignment issues (see post here ). Incorporate in Delaware and qualify the company to do business in the state in which its principal office is located (see #2 here ).

Accredited Investor 111

Accredited Investor Stock Options Delaware Silicon Valley 111

Gust

DECEMBER 8, 2011

Determine the allocation of equity among co-founders, early employees or other service providers, and future contributors as applicable, as well as the vesting schedule , if any, that will apply. Make escrow arrangements for restricted stock (i.e., Pick a name for the new legal entity (e.g., Newco, Inc.”) Yes, it’s a mouthful.

Intellectual Property 139

Intellectual Property Non-disclosure Agreement Delaware Stock 139

Tim Keane

JANUARY 12, 2010

3]   However, if they are built bottom up, they demonstrate and make explicit a range of business model assumptions the entrepreneur is using to think about his business and its revenue model. Term-sheets for preferred stock offerings are designed to protect the investor in case things don’t go as well as planned.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Scott Edward Walker

OCTOBER 27, 2015

Set-up vesting schedules for the founders (see post here ) and file 83(b) elections with the IRS (see #3 here ). Button-down IP ownership and assignment issues (see post here ). We charge a flat fee of $2,000, plus filing fees, for up to three co-founders and it includes unlimited phone calls and emails.

Intellectual Property 40

Intellectual Property Accredited Investor Vesting Delaware 40