Both Sides of the Table

MARCH 1, 2016

LPs See The Over-Valuations and Don’t Like It. LPs have followed the recent press about the over-valuation and over-funding of the startup industry, and they experience these phenomena first hand. But both seed investors and LPs alike agree that as long as these programs are managed sensibly, their existence is useful.

Venture Capital 150

Venture Capital LP Silicon Valley Marketing 150

genylabs.typepad.com

SEPTEMBER 24, 2011

I wont bother going into details on start-up financing terms ( see this post for an overview of typical VC terms) except to say if you dont know and understand: the firms cap table and valuation. where your stock sits in the liquidity preference stack. what rights and preferences the founders and the other investors have.

Equity 40

Equity Technical Review San Jose Stock 40

Feld Thoughts

FEBRUARY 28, 2023

Conversion right: In Germany, there is generally no conversion right entitling the holder of preferred shares to convert them into common shares at any time. This may not seem like a big deal at first glance, but it has extensive implications under various aspects, such as the structure of the liquidation preference.

Germany 165

Germany Liquidation Preference Option Pool Advisory Board 165

VC Adventure

AUGUST 30, 2010

Paul himself said in a March 2009 article : “When you hear people talking about a successful angel investor, they’re not saying "He got a 4x liquidation preference." I asked this question to a number of angel investors (all with institutional angel funds or running Y-Combinator like programs) and the results were mixed.

Angel Investor 103

Angel Investor Early Stage Equity Valuation 103

abovethecrowd.com

MAY 20, 2013

There are common stock, common options, and as many as three to five different layers of preferred stock, each with a specific liquidation preference. Even melding two separate option programs can be challenging. Private companies typically have capitalization structures that are very complex.

Merger 53

Merger Institutional Investors Liquidation Preference Preferred Stock 53

Startup Company Lawyer

FEBRUARY 21, 2010

Due to aggregate liquidation preferences that may exceed the acquisition price in an M&A deal, common stock may be rendered worthless. If you can’t figure this out yourself, you should probably build a liquidation preference spreadsheet to model how liquidation preferences work depending on M&A transaction value.

Retention 31

Retention Liquidation Preference Employee Common Stock 31

Professor VC

JULY 25, 2013

In investment parlance, it strictly means that new classes of stock have equal rights with prior classes in terms of liquidation preference, voting rights, etc. Another area where I''m not sure I stand is with some of the more formal referral and syndication programs that are emerging now. Thank you sir, may I have another!"

Term Sheet 46

Term Sheet Silicon Valley Syndicate Syndication 46