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Investors Beware: Today’s $100M+ Late-stage Private Rounds Are Very Different from an IPO

abovethecrowd.com

Historically, different financial institutions specialized in different stages, because the assessment of risk and opportunity was considered unique at each stage — for example, a seed investor was unlikely to do late-stage financing, and vice versa. If you want to know if the business model truly hunts, you must pay careful attention.

IPO 40
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Top 30 Startup Posts in June 2010

SoCal CTO

How-to learn about angel/vc term sheets - Gabriel Weinberg , June 28, 2010 I think every startup entrepreneur (and angel investor) should have a good understanding of financing term sheets. liquidation preference. Will you negotiate million dollars rounds of financing with cool VCs? Yes, even bootstrappers.

Cofounder 175
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Interview with Sramana Mitra on 1M/1M Program

Life Beyond Code

Through this journey, we have raised the visibility of fundamental issues like the causes of exorbitantly high infant entrepreneur mortality, and alerted the entrepreneur community with a simple observation: Entrepreneurship = (Customer + Revenue + Profits); Financing is Optional. The rest of the services are for paying members only.

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Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

For angel groups, the distinction between groups and VCs on this issue is dwindling, especially as angel groups do bigger rounds of financing.   You can vary both valuation and term-sheet assumptions (in the gray boxes) to assess the impact on the values of the business. Second a liquidation preference and a participation.

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Working for Equity Instead of Cash

genylabs.typepad.com

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
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Should you raise traditional VC or Revenue-Based Investing VC?

David Teten

Revenue-Based Investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. Focus on lower-risk business models; no requirement for a ‘swing for the fences’ model. But this is the same for a VC round with a liquidation preference. But should they?

Revenue 60
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Startup Fairy Tales and Other Tall Tales That Venture Capitalists Tell

Growthink Blog

The typical wisdom regarding the appropriate financing course for a new company goes as follows: 1. The angel then introduces the entrepreneur to his or her wealthy friends and business connections who, based on the good reputation of the referring angel, also invest. For most companies, it is simply a non-starter.