Startup Professionals Musings

MARCH 11, 2013

For example, you and your partner may be perfectly happy with an LLC, but venture capital or Angel investors may insist on having “preferred” stock, forcing an upgrade to a C-Corp. Legal requirements and tax requirements change as a business grows, so your entity needs to be reviewed regularly.

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LLC Nevada Delaware Limited Liability Company 234

ithacaVC

JUNE 29, 2018

This typically results when the company has raised a lot of money and the preferred stock liquidation preference would absorb an out sized portion of the exit proceeds. Some great carve out plan materials were recently shared with me so I thought best to “memorialize” them in a blog post.

Management 40

Management Liquidation Preference Preferred Stock Dilution 40

www.mattbartus.com

SEPTEMBER 24, 2011

Blog blog archive. First, you’d probably want them to receive common stock, not preferred stock (which is the likely next round). Sorry, your blog cannot share posts by email. A View from the Valley. Quora Answers. About Matt. Client references. Equity for Consultants – Keep it Simple!

Equity 40

Equity Vesting Silicon Valley Intellectual Property 40

The Startup Lawyer

JUNE 22, 2010

If you follow this blog, you know that I think convertible debt is a good structure for a startup’s angel round. For this article, let’s assume this equity is the Series A Preferred Stock purchased by a venture capital fund. For example, if a venture capital fund purchases Series A Preferred Stock at $1.00

Pre-Money Valuation 82

Pre-Money Valuation Angel Investor Preferred Stock Valuation 82

Scott Edward Walker

SEPTEMBER 21, 2011

By getting-out and attending conferences and meet-ups; by blogging; by reading and commenting on other blogs; and by engaging on Twitter and other social media sites. Finally, unless the startup is raising at least approximately $750,000, it generally is not in the company’s interest to issue shares of preferred stock.

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Preferred Stock Angel Investor Entrepreneur Common Stock 45

Business Plan Blog

APRIL 10, 2012

According to their blog, “a convertible note is short-term debt that converts into equity. In the context of a seed financing, the debt typically automatically converts into shares of preferred stock upon the closing of a Series A round of financing.” But wait, what’s convertible note seed financing??

Finance 40

Finance Preferred Stock Equity Stock 40

Steve Blank

OCTOBER 24, 2017

It’s hard to imagine, but in the 20th century there were no startup blogs or books on startups to read, and business schools (the only places teaching entrepreneurship) believed the best thing they could teach startups was how to write a business plan. Founders can now outvote the preferred stock holders (the investors).

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Founder Technical Review CTO Hire IPO 245

K9 Ventures

MAY 14, 2011

Common Stock. Convertible Note or Preferred Stock. Convertible Note or Preferred Stock. Preferred Stock. Preferred Stock. Preferred Stock / Warrants. Limited Partners, very little Personal Money. Corporate Money. Investment Structure. Debt or Convertible Note. Board Seats.

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Preferred Stock Seed Stage Incubator Early Stage 125

ithacaVC

DECEMBER 14, 2011

Nothing better than sitting at LGA writing blog posts. Continuing with the “No Mess” theme of commenting on things that give VCs pause, I thought it would be good to touch on liquidation preference. Specifically, “too much” liquidation preference (I will use “LP” for liquidation preference).

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Liquidation Preference LP Preferred Stock Liquidity Event 49

Agile VC

DECEMBER 4, 2014

It’s also worth keeping in mind that regardless of how the founders’ common stock is divided, there will be future issuance of stock that will dilute the founders over the lifecycle of the company.

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Cofounder Equity Founder Sweat Equity 173

www.quora.com

JANUARY 16, 2011

Brad Feld does the best blog term sheet series. Mark Suster • Nov 1, 2010 Here is a post on Brad Feld's blog on the seed financing docs he found, some of which you mention: [link] chives/. continue) How influenced are VCs by mentions/opinions of a startup in top blogs, n. org/index.php?op.

Term Sheet 41

Term Sheet Startup Angel Investor Wiki 41

Both Sides of the Table

AUGUST 30, 2010

Seth Levine of Foundry Group addresses this important topic this morning on his blog with a post, “ Has Convertible Debt Won ?&# Funnily enough I just answered this question yesterday on Quora when somebody asked, “Why would an early-stage investor specifically NOT prefer a convertible note structure to straight equity (e.g.

Equity 319

Equity Early Stage Angel Investor Valuation 319

Business Plan Blog

NOVEMBER 13, 2013

3) Giving non-voting stock. NOTE: Angel investors are typically allocated common stock, the same class of stock as owned by founders, as opposed to preferred stocks, which are offered to VCs. Arushi Bhandari, CPA, MBA blogs regularly at www.startuptaxaccounting.com. 2) Giving equity in the company.

Finance 93

Finance Accredited Investor Angel Investor Seed Capital 93

Austin Startup

OCTOBER 27, 2017

Out of State VCs When you’re not CEO Material Preferred Stock v. Common Stock Ask the Users Because we’re known as Startup/VC lawyers who don’t represent VCs (just companies), I often get asked about my thoughts on “founder friendliness.” Good entrepreneurs and advisors know that. Background reading: Local v.

Founder 48

Founder Cap Table Preferred Stock Common Stock 48

www.payne.org

SEPTEMBER 22, 2011

Your offer will almost surely be for common stock. Preferred stock classes typically go to investors, and in some cases founders (usually where the founders have already invested some of their own money to build the company). If the company is acquired or liquidated, the preferred stock holders will get paid first.

Equity 56

Equity Employee Vesting Preferred Stock 56

Startup Company Lawyer

APRIL 22, 2009

Always looking for ways to better serve the entrepreneurial community, Wilson Sonsini Goodrich & Rosati is pleased to announce the release of the WSGR Term Sheet Generator , a publicly available online tool that allows entrepreneurs and investors to generate an initial draft of a term sheet for a preferred stock financing.

Term Sheet 39

Term Sheet Finance Preferred Stock Kentucky 39

Ben's Blog

JULY 16, 2013

In fact, if you are like most companies, your managers probably implied to your employees that your stock price would only rise as long as you were private. They might have said something ridiculous like: “Based on the current price of the preferred stock, your offer is already worth $5M.” As if the price could never go down.

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Down Round Marketing Preferred Stock Post-Money Valuation 78

thestartuplawyer.com

FEBRUARY 24, 2010

so glad we found this blog [too bad it was a little too late]. BTW, I tried visiting your blog but it crashes my Safari browser (Mac version) each time. I wrote a previous blog article regarding startup co-founders. [.] North says: June 9, 2009 at 8:50 pm Thanks for this whole blog its the best I have found.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

Growthink Blog

APRIL 7, 2010

The name "Series A" refers to the class of preferred stock that you sell to investors in return for their cash. Your Series A round is typically the first series of stock issued after common stock (which is typically issued and/or sold to company founders, employees, friends and family, and initial angel investors).

Angel Investor 54

Angel Investor Preferred Stock Venture Capital Common Stock 54

Lightspeed Venture Partners

OCTOBER 1, 2012

These are typically called “ participating preferred ” structures, and are quite uncommon in West Coast VC deals these days, although they were once more common a couple of decades ago, and are still seen in some East Coast deals. In most investments, the investor gets straight preferred stock.

Pre-Money Valuation 152

Pre-Money Valuation Valuation Participating Preferred Preferred Stock 152

The Startup Lawyer

MARCH 11, 2010

That’s one of the reasons why I started this blog in 2006. Tags: Preferred Stock legal documents seed funding startup Startup Lawyer. I support any effort to bring transparency to the law firm establishment and otherwise educate entrepreneurs (including model seed funding documents).

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Delaware Hockey Stick Preferred Stock Open Source 49

The Startup Lawyer

MARCH 11, 2010

That’s one of the reasons why I started this blog in 2006. Tags: Preferred Stock legal documents seed funding startup Startup Lawyer. I support any effort to bring transparency to the law firm establishment and otherwise educate entrepreneurs (including model seed funding documents).

Delaware 45

Delaware Hockey Stick Preferred Stock Open Source 45

Professor VC

DECEMBER 26, 2012

As December and 2012 draws to a close, I've decided to weigh in with my thoughts on the impending (or not depending on which blogs you read) Series A Crunch. Alas, we survived 12/21 and looks like we will have to get back to work in 2013. Is it a good thing that so many entrepreneurs are able to get $250K - $1.5M in seed financing?

Finance 48

Finance Angel Investor Private Equity Preferred Stock 48

Ben's Blog

JULY 16, 2013

In fact, if you are like most companies, your managers probably implied to your employees that your stock price would only rise as long as you were private. They might have said something ridiculous like: “Based on the current price of the preferred stock, your offer is already worth $5M.” As if the price could never go down.

Marketing 46

Marketing Preferred Stock Post-Money Valuation Down Round 46

Professor VC

JANUARY 17, 2008

One of the panelists mentioned that they have gotten very valuation sensitive (nothing wrong with that) and like to purchase preferred stock rather than invest in convertible notes. Blog Archive. My Blog List. Another comment which probably deserves more discussion is around valuation. November 22, 2009 2:03 AM.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

Growthink Blog

MAY 10, 2012

The name is derived from the class of preferred stock investors receive in return for their capital. Stage #3: Early Stage Investment (Series A & B) "Series A" is the term used to describe the first round of institutional funding for a venture.

Equity 88

Equity Mezzanine Later Stage Venture Capital 88

Tim Keane

JANUARY 12, 2010

Term-sheets for preferred stock offerings are designed to protect the investor in case things don’t go as well as planned. Term-sheets for preferred stock offerings are designed to protect the investor in case things don’t go as well as planned. Subscribe to this blogs feed. Bootstrapping. Creating The Opportunity.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Up and Running

MAY 23, 2016

Delaware law gives preferred stock investors of a corporation certain voting rights and control over the corporation. You can start by reading a few (or all) of these 17 venture capital blogs, reading Tim Berry’s thoughts on what venture capital firms want, and his advice on finding venture funding. Funding Guide. Last year?

Software Review 74

Software Review Software Delaware Forecast 74

Startup Company Lawyer

APRIL 23, 2009

Super-voting common stock is sometimes seen in companies where founders or a family wish to maintain control of a company after obtaining outside investment. At a minimum, people like Adeo and blogs like Venture Hacks are educating founders about financing terms that may be detrimental to founders. Protective provisions.

Common Stock 33

Common Stock Stock Dividend Delaware 33

Hunter Walker

SEPTEMBER 29, 2022

Starting a venture capital blog post with 1970s country music lyrics is pretty uncommon, but so is writing about when and why an investor might choose to sell equity before the company exits. All the preferred stock is pari passu and behaving honorably in the best interest of the company?

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Venture Capital Cap Table LP Equity 122

www.mattbartus.com

DECEMBER 9, 2012

an option to purchase shares in the future at a pre-determined price) to the investor to purchase preferred stock at the Series A price. Sorry, your blog cannot share posts by email. One possibility is to negotiate a higher valuation and offer warrants (i.e., Send to Email Address. Your Email Address. startupcto

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

Tim Keane

APRIL 12, 2006

Preferred Stock is the most usual form of investment today. Preferred Stock is the most usual form of investment today. Subscribe to this blogs feed. Debt with some sort of conversion provides greater risk abatement in that debt comes “due” at some point if the conversion terms aren’t met. Bootstrapping.

Entrepreneur 60

Entrepreneur Valuation Sweat Equity Common Stock 60

abovethecrowd.com

FEBRUARY 24, 2015

[An edited version of the following blog post originally appeared in a modified form in the pages of the weekend edition of the Financial Times last Saturday. ]. Most private company financings involve the use of preferred stock with liquidation preferences.

IPO 40

IPO Liquidation Preference Valuation Technical Review 40

Scott Edward Walker

NOVEMBER 26, 2017

From a practical perspective, this means getting actively involved in your local tech community, regularly attending industry events and conferences, writing blog posts/articles, integrating yourself into communities on social networks and, of course, doing outstanding work as an employee (to develop a great reputation).

Term Sheet 63

Term Sheet San Francisco Founder Investment Bankers 63

Board Effect

MAY 10, 2019

Two of the most popular equity securities found on a cap table are common and preferred stock. Securities can be broken up across multiple columns based on the company’s share structure. Cap tables may also include derivatives such as warrants and options.

Cap Table 40

Cap Table Liquidation Preference Dilution Liquidity Event 40

www.vccafe.com

MARCH 11, 2013

Based on the list posted on StartupWeekend Resources pag e and the TokBox blog. Website/Blogging. website/blog spelling checker. Analytics blog â?? WordPress - king of blogging platformsâ?¦doubles another blogging platform. yet another blogging platform. blog on roadmap for learning rails.

Software Review 53

Software Review Technical Review Startup 53