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Ten million users is the new one million users

Chris Dixon

It’s becoming increasingly common for early-stage consumer startups to do bridge financings (raising more money from past investors, usually on terms similar to the prior round) instead of Series As. - Entrepreneurs and investors have been enamored with consumer internet startups for the last few years. startups

Convertible Debt – Early Versus Late Stage Dynamics

Ask The VC

Traditionally, convertible debt was issued by mid to late stage startups that needed a financing to get them to a place where they believed they could raise more money. Thus, these deals were called “bridge financings.”. Some of these bridge loans also contained terms like pay to play.

Budgets: Past Performance and Future Results

Florida Venture Blog

It dishes some knowledge on bridge financings and the auto industry predicament, all in one insightful post. So, which is it?

Budgets: Past Performance and Future Results

Florida Venture Blog

It dishes some knowledge on bridge financings and the auto industry predicament, all in one insightful post. So, which is it?

Knowledge Is Power: Convertible Note Financing Terms, Part I

Gust

It should therefore come as no surprise that an asymmetry of information exists, mostly gleaned from experience, between founders and investors in a venture financing deal. A term sheet for a convertible note deal may run two or three pages, versus 8-10 pages for a typical Series A Preferred Stock financing. (I’ve Knowledge is power.

Bad Notes on VC

Gust

It’s like we need a finance 101 course for entrepreneurs. In finance they call it “terminal value” but the truth is the price is as arbitrary at your A round as it is at your seed round. I really just want to champion Finance 101 to entrepreneurs. This week. On the phone …. Me: So, you raised venture capital? Him: Yeah. Me: Ah.

Thoughts on Convertible Notes

K9 Ventures

In that case, it made good sense to have a debt instrument, where the note holder then converted into equity when the financing occurred.

How to Evaluate an Offer from a Startup Incubator

The Startup Lawyer

Like any issuance of stock or investment, one of the main things a startup should be concerned with is: Is this going to fuck up a future financing ? If the terms won’t hinder a future financing, then your startup is good to go. If not, the incubator is just a bridge financing to potentially nowhere for your startup.

The Series A Round is the New Series B Round

Jeff Jordan

The venture industry is awash with talk of the “Series A Crunch”, where it’s getting progressively more challenging for seed companies to land follow-on financing. In 2009, there were about the same number of seed and Series A financings, but the number of seed deals have exploded since then while the number of A-rounds grew only modestly.

Startups and VCs Should Avoid “Pier” Funding

Both Sides of the Table

a loan) that is later converted to equity at the time of the next financing. It starts as a debt instrument (e.g. And it adds up.

The Option Pool Shuffle

venturehacks.com

That does work if the company gets sold before another round of financing. This can be done on any financing or M&A event. Thanks!

Don't Run Out of Cash: 3 Growth-Company Case Studies

Fresh Inc.: The Staff Blog

But the fast growth had a downside: Cramton realized he was losing control of the company''s finances. Nice growth company you got there.

Mobile Backstage Grabs €1 Million, Opens Office In San Francisco

ArcticStartup

Helsinki-based Mobile Backstage has secured a €1 million bridge financing round. Nowadays its totally different.

What is a convertible bridge note with a price cap?

Startup Company Lawyer

I seem to be doing a lot of pre-Series A convertible bridge note financings these days. 50%) or warrant coverage are typically more company-favorable than a Series A financing where a valuation is set. Similarly, if the company was sold for $100M before another round of financing, the investor would receive 10%, or $10M.

Are VCs Lemmings?

Thinking About Thinking

If a stream or river interrupts their path [no exit market], they swim across [bridge financings]. Many in the entrepreneurial ecosystem (VCs included) have used the phrase, “VCs are all lemmings.” Is this true? Is it not? Before answering that question, let us take a look at the lemming migration across the Norwegian coast. etc.].

The Basics of Small Business Loans [WEBINAR]

Up and Running

Hopefully I’ll be able to add some value with some of the financing needs that your businesses may need. A lot! Scott: Hi everybody. Thanks.

SBA 24

ProfessorVC: Why I Hate Convertible Debt.Let Me Count the Ways

Professor VC

This will also serve as a good pointer for all the entrepreneurs who ask why I am not interested in their company led convertible note financing round. Is This a Bridge or a Pier? This can make it much more difficult to get any bank financing, new investment, and trade credit. In cases where it is truly a bridge financing (i.e.

Founders Shares: How do you split them up?

www.copelandfirm.com

Startup Law 24 February 2010 There are a few common ways that founders split up equity and ownership of the company: 1.) Who helped refine the idea?

Some Thoughts On Foursquare

A VC : Venture Capital and Technology

Our portfolio company Foursquare closed a second round of financing yesterday. This was a much covered financing process and also much criticized. The Company could have closed a financing at a very attractive valuation in two or three weeks if they had chosen to. But all of the other firms were eager to make an investment.

SEC Defines Venture Capital

Venture Chronicles

Here’s what would, according to this definition, be illegal for a venture capital fund to undertake: Private investment in public entity (PIPE) financing. This has been a lucrative area for VC funds to invest in and has also been critically important for companies to tap when other finance options (e.g. Bridge financing.

Advantages of Convertible Debt in Seed Financing

VC Ready Blog

A convertible debt financing is similar to a traditional loan in that the company borrows money (often from angel investors, but sometimes from friends and family or even VCs) and commits to repay it with interest by the end of the term of the loan. One way is through convertible debt.

Advantages of Convertible Debt in Seed Financing

VC Ready Blog

A convertible debt financing is similar to a traditional loan in that the company borrows money (often from angel investors, but sometimes from friends and family or even VCs) and commits to repay it with interest by the end of the term of the loan. One way is through convertible debt.

Advantages of Convertible Debt in Seed Financing

VC Ready Blog

A convertible debt financing is similar to a traditional loan in that the company borrows money (often from angel investors, but sometimes from friends and family or even VCs) and commits to repay it with interest by the end of the term of the loan. One way is through convertible debt.

Know the Mindset

ithacaVC

It may explain why Fund Y tries to protect itself, via deal terms, from pay to play provisions that would kick in with respect to future financings. This sounds obvious – make sure to know the mindset of your investors. Typically, I think that most entrepreneurs raising VC think that the VC mindset is standard. And it often is.

This Week in VC Episode 6 with @Jason Calacanis: Best One Yet

Both Sides of the Table

Often times when companies raise “bridgefinancing (this is money from internal investors. short answer: very, very rarely.

Startup Post-Mortem: Admazely and why it failed

ArcticStartup

And so I spent not that much time on the bridge financing, as long as I was convinced it was in place. A while ago Peter V. It’s over.

The High Cost of Optimism

Will Price

The insiders and management are then faced with the dreaded prospect of a down round or a bridge financing to tide the company through to meeting its original plan. The Standish Group , which analyzes IT projects, reported that in 2004 only 29% of IT projects succeeded, down from 34% in 2002. Think about the LBO business.

LBO 0

The Cost of Optimism

Will Price

The insiders and management are then faced with the dreaded prospect of a down round or a bridge financing to tide the company through to meeting its original plan. The Economist recently ran a wonderful piece on the sorry state of project management. passenger or car traffic) were overly aggressive by an average of 106%.

LBO 0

Is Europe going to emasculate venture with misguided regulation ?

Fred Destin

Basically Mr Rasmussen feels like we need to be transparent and seems to think that we pose a systemic risk to the economy. through regulation !)

Update on Carried Interest Legislation

Recent Buzzes - VC Experts, Inc.

Those certain services are (1) advising as to the advisability of investing in, purchasing, or selling any specified asset, (2) managing, acquiring, or disposing of any specified asset, (3) arranging financing with respect to acquiring specified assets, and (4) any activity in support of any of the foregoing services. By Bradford D. 4213).