David Teten

JANUARY 19, 2021

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. From RBI, Flexible VCs borrow the ability to reap meaningful returns without demanding founders build for an exit. By tying payments to actual revenues, founders and investors remain aligned around the company’s real-time performance, good or bad.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Both Sides of the Table

NOVEMBER 14, 2017

As the idea went from innovating on software & systems to launching a company to rolling it out in the field brought on Rahul Gandhi as his co-founder to physically launch the company. Sam & Rahul have worked closely together on “innovate & operate” since the earliest days of MakeSpace. Seriously, this happens.

Operations 286

Operations New York City Technical Review Startup 286

David Teten

AUGUST 19, 2019

RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Bigfoot Capital.

Revenue 60

Revenue Technical Review Software Review Equity 60

Startup Company Lawyer

MARCH 14, 2010

After the recent announcement of the Series Seed Financing documents by Marc Andreesen, Brad Feld points out that there are now four sets of “open source&# equity seed financing documents: TechStars Model Seed Funding Documents (by Cooley). Y Combinator Series AA Equity Financing Documents (by WSGR). under $500K).

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Startup Professionals Musings

OCTOBER 9, 2021

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Practical business courses are better than an advanced degree or MBA.

Entrepreneur 373

Entrepreneur Chad Incubator Dilution 373

Altgate

DECEMBER 15, 2010

@altgate Startups, Venture Capital & Everything In Between Skip to content Home Furqan Nazeeri (fn@altgate.com) ← No one wants to tell you your baby is ugly More on Liquidation Preferences → Pre-Money Valuation vs Number of Founders Posted on December 15, 2010 by admin Here’s a chart of the day worth sharing.

Pre-Money Valuation 66

Pre-Money Valuation Valuation Cofounder Founder 66

Austin Startup

FEBRUARY 4, 2019

L to R: Tiara Zolniez (Co-Founder & Sales), Dr. Roshawnna Novellus (Co-Founder & CEO), Alisha Griffey (COO) The Forrest Four-Cast: February 4, 2019 Fifty diverse startups will aim to impress a panel of judges and a live audience with their skills, creativity and innovation at SXSW Pitch Presented by Cyndx.

Startup 50

Startup Cofounder Technical Review Equity 50

www.avc.com

SEPTEMBER 22, 2011

To be clear, these are hires we are talking about, not co-founders. Co-founders are an entirely different discussion and I am not talking about them in this post. This "best value" can be the valuation on the last round of financing. The other important data point is the number of fully diluted shares.

Equity 64

Equity Employee CTO Hire Fractional CTO 64

Both Sides of the Table

JUNE 5, 2015

I am reminded of this problem every time my firm does a financing where a note went before us but more specifically I was reminded by this great post by Brad Feld to talk about the pre-money vs. post-money conversion issue. So how DOES a VC think about financings at early stages? It’s very simple. Size of my check.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Feld Thoughts

JULY 29, 2011

Finance Friday’s gets off the ground with today’s post by introducing you to an imaginary startup, the entrepreneurs that we’ll being following throughout the series, and their first challenges: splitting up the founders’ equity and addressing the case where one of the founders provides the initial seed capital for the business.

Equity 137

Equity Finance Pre-Money Valuation Denver 137

Startup Professionals Musings

OCTOBER 28, 2018

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Practical business courses are better than an advanced degree or MBA.

Chad 242

Chad Incubator Startup Dilution 242

Hunter Walker

AUGUST 8, 2023

Obvious caveats to my POV here, most specifically: exposure is limited to largely the US/SiliconValley ecosystem, driven by our own portfolio, my friends and co-investors, the funds I’m a LP in, and our institutional LP relationships. Whatever gets reported is just the tip of the iceberg. And that’s what’s happening here.

Portfolio 98

Portfolio Cap Table LP Valuation 98

Hunter Walker

AUGUST 7, 2017

Employee options pools, typically created at the point of financings, shouldn’t be treated as haggling over dilution, but rather a strategic resource that will help founders build the best team and, by extension, a more valuable company.

Equity 94

Equity Pre-Money Valuation Option Pool Founder 94

Both Sides of the Table

DECEMBER 1, 2009

I was reading one of my favorite websites for entrepreneurs, VentureHacks, this weekend and noticed that they are running a long piece on how to pick a co-founder. Once it’s set up I recommend bringing in a co-founder and giving them 10-30% of the company depending upon when you bring them in. You’ll be fine.

Hiring 289

Hiring Cofounder Dilution Startup 289

ReadWriteStart

APRIL 4, 2023

Joe Flanagan, Founder, 90s Fashion World No, Too Many Lenders While the idea of sourcing capital from multiple smaller sources is an enticing one, the reality is far less pleasant. Inbar Madar , Founder and Business Consultant, M.I. Another major issue with crowdfunding is that standing out in a crowded marketplace can be tough.

Startup 141

Startup Campaign Cofounder Venture Capital 141

www.inc.com

SEPTEMBER 24, 2011

Finance | Tuesdays. Financing a Small Business. Financing A Small Business. Personal Finance. Before Roving Software could receive its first round of financing from professional investors, in early 1999, he had to put all the stock arrangements in writing. Start-up | Mondays. Technology | Thursdays. Franchises.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

Startup Professionals Musings

NOVEMBER 15, 2014

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Practical business courses are better than an advanced degree or MBA.

Chad 279

Chad Incubator Dilution LLC 279

Scott Edward Walker

APRIL 8, 2013

. “Be careful not to have too many co-founders; it’s the most expensive dilution you’ll ever face.” Seed Finance Survey 2012 (via Fenwick) [link]. Seed Finance Survey 2012 (via Fenwick) [link]. Twitter Highlights co-founders dilution quora seed seed finance startup startup ideas startups'

Dilution 49

Dilution Cofounder RSS Finance 49

Scott Edward Walker

APRIL 9, 2012

Introduction We are in the golden age of seed financing. Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook. and (iii) what are the advantages of issuing convertible notes?

Preferred Stock 87

Preferred Stock Finance Common Stock Liquidation Preference 87

The Startup Lawyer

AUGUST 22, 2011

Here’s a list of the top 5 deal terms that cause harm to startups at the seed financing stage and therefore should be avoided: 5. This is something you might see in a late stage private equity financing with a company that has a history of generating revenue. Non-Dilution. What a deal — for the investor.

Angel Investor 99

Angel Investor Dividend Dilution Cofounder 99

View from Seed

JANUARY 28, 2016

When we talk about seeds, we mean your first outside round of financing at the earliest stages of your business. In my prior post, I talked about the rise of the pre-seed and a more nuanced definition of a pre-seed based on milestones, not financing labels. This staged approach is often much better for the founders as well.

Cofounder 120

Cofounder Finance Founder Syndicate 120

David Teten

JANUARY 21, 2021

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. This essay is part of a series on alternative VC: I: Revenue-Based Investing: a new option for founders who care about control. III: Why are Revenue-Based VCs investing in so many women and underrepresented founders?

Equity 78

Equity Revenue Cofounder Colorado 78

thestartuplawyer.com

FEBRUARY 24, 2010

He obviously never launched a startup and got shafted by a co-founder. He obviously never launched a startup and got shafted by a co-founder. He obviously never launched a startup and got shafted by a co-founder. You can start by examining every aspect of the co-founder relationship.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

David Teten

AUGUST 21, 2019

Most founders who are raising capital look first to traditional equity VCs. Revenue-Based Investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. For more background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Less or no dilution.

Revenue 60

Revenue Liquidation Preference Equity Cofounder 60

Hunter Walker

JANUARY 15, 2016

By the end of 2004 I had brought on two co-founders: John Vars – who is now the Chief Product Office at TaskRabbit, and Steven Reading took over Sales and Revenue. How do founders think about whether it’s time to move on or not? Ben Horowitz talks about asking founders what secret they know that no one else does.

Technical Review 48

Technical Review Startup Cofounder SMS 48

View from Seed

JANUARY 26, 2016

There are a number of factors that have contributed to the rise of pre-seed rounds, but the strongest have been the frothy late-stage financing market, coupled with both the scaling-up of some of the early winners in the institutional seed ecosystem and the scaling-down of some larger funds that retrenched after the financial crisis.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 120

Both Sides of the Table

APRIL 14, 2012

What I want to talk about today is one of the insider baseball discussions of our industry this past week: The odd fact of the $500 million financing round completed just before the company sold for a B. You just said, “nobody would take 1-2% dilution.” But I owe it to my existing investors and co-founders to listen.

Valuation 316

Valuation Balance Sheet Dilution Term Sheet 316

A Smart Bear: Startups and Marketing for Geeks

JULY 11, 2011

SEOmoz founder and figurehead Rand Fishkin wrote a typically transparent, thoughtful blog post about his struggle of whether to raise a Series B. The typical arguments against: (a) unfair to employees/co-founders, (b) now you’re not hungry so you care less, work less, (c) swinging for fences without attention to detail is imprudent.

.Net 230

.Net Cofounder Dilution Finance 230

Startup Professionals Musings

OCTOBER 15, 2016

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Practical business courses are better than an advanced degree or MBA.

Entrepreneur 120

Entrepreneur Chad Incubator Dilution 120

K9 Ventures

MAY 6, 2015

Conventional wisdom in the startup world dictates that two founders are ideal for a startup. There are lots of famous pairs of duo co-founders: Larry Page and Sergey Brin, Jerry Yang and David Filo, Hewlett and Packard, Bill Gates and Paul Allen. Having the right co-founder is perhaps the single most valuable thing in a startup.

Cofounder 48

Cofounder Founder Silicon Valley Technical Cofounder 48

This is going to be BIG.

DECEMBER 28, 2013

Every time he opens his mouth about founder diversity, he seems completely out of his league to address the topic. The biggest question I think VC''s face right now is whether or not, in the future, the best founders will look and act like the best founders of the past. That''s less than 10%. That''s 25%.

Venture Capital 152

Venture Capital Cofounder IRR Dilution 152

David Teten

NOVEMBER 17, 2011

I’ve often found it helpful to have on hand a simple model showing the impact of each financing stages on all team members, suitable for sharing with everyone in the company. In particular, this model is designed to help all team members understand the impact of dilution on their options.

Employee 155

Employee IRR Startup Mexico 155

Berkonomics

FEBRUARY 28, 2019

It’s a fact of life that a banker, lender or lessor will ask for a personal guarantee from the founder or entrepreneur most every time. But what if you’ve diluted your interest from 100% to something less than 50%? Should your investors expect you to carry 100% of the risk? The short answer is “yes.” Seems unfair, doesn’t it?

Warrant 48

Warrant Liquidity Event Dilution Cofounder 48

Startup Company Lawyer

MAY 4, 2009

Adeo Ressi , the founding member of TheFunded , recently announced the establishment of TheFunded Founder Institute. The Founder Institute helps founders launch innovative companies by providing training, services, and company-building assignments, such as incorporating the business, filing provision patents, and setting up books and records.

Founder 28

Founder Warrant San Francisco Intellectual Property 28

Berkonomics

AUGUST 27, 2015

He has served as advisor to and member of numerous financial exchanges, and was the founder and CEO of Arthur Lipper Corporation and co-founder and Chairman of New York & Foreign Securities Corporation. Today he serves as Chairman of British Far East Holdings Ltd.

Intellectual Property 48

Intellectual Property Balance Sheet Stock Options Valuation 48

The Startup Lawyer

MARCH 1, 2010

“The Series Seed Documents are a standardized set of documents that can be quickly and easily deployed for a seed investment: to help get a company financed properly, legally, quickly, and intelligently.&#. It also scales back the right of first refusal and jettisons the co-sale right. 4) Term Sheet. Check out the docs here.

Preferred Stock 79

Preferred Stock Term Sheet Redemption Registration Rights 79

Ben's Blog

AUGUST 17, 2020

When speaking with founders and private growth investors, we hear countless references to “multiples paid” on current or near-term revenue; both obsess over this because a higher multiple translates to a higher valuation. How valuation multiples work Why did multiples become a shortcut-heuristic for estimating valuations in the first place?

Valuation 36

Valuation Balance Sheet Cofounder Forecast 36