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. Early-stage venture capital is about extreme winners. It sold to Amazon for > $1 billion.

Bankruptcy 294

Bankruptcy Bridge Financing Portfolio Angel Investor 294

David Teten

AUGUST 19, 2019

Though RBI will displace some traditional equity VC, its much bigger impact will be to expand the pool of capital available for early-stage entrepreneurs. . However, only recently have early-stage companies started to use this model at any scale. . So what is Revenue Based Investing?

Revenue 60

Revenue Term Sheet Founder Technical Review 60

Gust

SEPTEMBER 29, 2011

Given that convertible debt financing has become the de facto standard for small (<$1MM), early stage deals in recent years, I thought I would write a primer on the elements of a term sheet and definitive documents for entrepreneurs looking at the earliest stage financing rounds.

Finance 178

Finance Term Sheet Preferred Stock Bridge Financing 178

cdixon.org

AUGUST 3, 2012

Some observations: - Thousands of early-stage consumer web/mobile companies were started and funded in last 24 months. A few breakout early-stage consumer hits (Instagram, Pinterest) have reached tens of millions of users in record time. Hence, many early-stage consumer startups are switching to transactional models. -

Bridge Financing 86

Bridge Financing Early Stage Valuation Later Stage 86

Both Sides of the Table

SEPTEMBER 18, 2014

Convertible notes were previously used primarily for “inside rounds” in which the existing investors provide you with bridge financing to get to the next round. I have never come across a sophisticated A, B or C round venture capitalist who thinks convertible notes are a smart move for entrepreneur or investor.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Both Sides of the Table

MAY 23, 2010

So by offering convertible debt you can avoid a price discussion in the same way that angel investors sometimes do in order to win competitive early-stage deals.

Startup 290

Startup Burn Rate Warrant Bankruptcy 290

K9 Ventures

MARCH 23, 2011

I may be well be in the minority in the Valley to think this way — especially so as a seed stage investor — but I have a strong preference for doing priced equity rounds for funding companies at any stage. For taking the risk of the financing not happening the note holder received a discount on the price of the round.

Pre-Money Valuation 132

Pre-Money Valuation Valuation Equity Liquidation Preference 132