Both Sides of the Table

JUNE 27, 2021

We’ve had two companies where we had to bridge finance them several times before they eventually IPO’d We had a portfolio company turn-down a $350 million acquisition because they wanted at least $400 million. Consider: When GOAT started it was a restaurant reservation booking app called GrubWithUs … it’s now worth $3.7

Bankruptcy 294

Bankruptcy Bridge Financing Portfolio Angel Investor 294

Both Sides of the Table

SEPTEMBER 18, 2014

I know how to structure around that to protect the founders from getting screwed on a multiple liquidation preference. But most VCs don’t bother so many convertible note founders get screwed and never know it until they sell their companies. These are all real conversations. I see that all the time. My colleague: Whoa.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Gust

SEPTEMBER 29, 2011

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. Conversion terms are where the money is, literally and figuratively.

Finance 178

Finance Term Sheet Preferred Stock Bridge Financing 178

Gust

SEPTEMBER 17, 2014

I know how to structure around that to protect the founders from getting screwed on a multiple liquidation preference. But most VCs don’t bother so many convertible note founders get screwed and never know it until they sell their companies. These are all real conversations. I see that all the time. My colleague: Whoa.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

K9 Ventures

MARCH 23, 2011

The convertible note was really intended as an instrument for a “bridge financing” – when an equity round was imminent, and likely to occur, but the company needed some money in between. In that case, it made good sense to have a debt instrument, where the note holder then converted into equity when the financing occurred.

Pre-Money Valuation 132

Pre-Money Valuation Valuation Equity Liquidation Preference 132

The Startup Lawyer

FEBRUARY 4, 2011

But before your startup signs up and cashes that $[XX,000] check, your startup’s co-founders should sit down and evaluate the incubator’s offer. Most incubators take common stock and sit “side-by-side&# with the founders, but some may want some (weak) preferred stock and/or dilution protection. Conclusion.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Both Sides of the Table

MAY 15, 2010

Often times when companies raise “bridge” financing (this is money from internal investors. has demonstrated both high user engagement and better than average conversion rates of 1%-3.5% (versus 0.05% for traditional display advertising) for February 2010. We spoke briefly about why. Short answer: no.

Stealth 285

Stealth SEC Advertising Accredited Investor 285