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8 Ways To Maximize The Value Of Your Startup Stock

Startup Professionals Musings

Make sure the government waits for a stock sale to collect taxes. Spread stock issuance over an earning period. In the U.S.,

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Dual Class Common Stock Structure for Founders

The Startup Lawyer

A startup founder’s desire to hold equity better than plain-vanilla common stock isn’t new. Several years ago, Series FF stock for founders was all the rage when it came to founder liquidity at subsequent financing rounds. We implemented Series FF for a handful of clients back then but we haven’t done so recently.

Common Stock vs. Preferred Stock in Venture Funding Transactions

Growthink Blog

The question is whether they need to issue common or preferred stock. If, then the company were to be sold for $5,000,000 (i.e.

What is Class F common stock?

Startup Company Lawyer

These provisions include a special class of super-voting common stock, called “Class F&# common stock, which is named for “Founders.&#. The COI includes Class A common stock, which has one vote per share, and Class F common stock, which has 10 votes per share. Voting. Directors.

Founder Liquidity

K9 Ventures

If there is one piece of advice I would give to the founders of BST, it is to consider selling a part of their personal stock in the company at that stage. By the time a company gets to its Series B or Series C, it is quite common for the founders to have lost control of the board or the company in general. aka BST).

How Many Shares Should be Issued to Founders at Incorporation?

The Startup Lawyer

I typically advise issuing 50% to 80% of the authorized shares of Common Stock to the initial founders upon incorporation. Thus, if the certificate of incorporation authorizes 10,000,000 shares of Common Stock, an aggregate of 5,000,000 to 8,000,000 share should be issued at incorporation. Incorporation

How to Divide Founder Equity: 4 Criteria to Discuss

View from Seed

You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently. Ideation/IP.

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Punch & Pie: How Should Co-Founders Divide Equity?

Agile VC

You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently.

Rackspace Officially Goes Private in $4.3 Billion Deal

SiliconHills

Its common stock, under the symbol RAX, will no longer be listed for trading on the […] The post Rackspace Officially Goes Private in $4.3

To Maintain Control of Your Company After Its IPO, Follow Mark Zuckerberg's Lead

Fresh Inc.: The Staff Blog

Facebook shareholders quickly voted down a proposal to give its common stock shareholders more say in the company's decisions

Expedia to Buy HomeAway for $3.9 Billion

SiliconHills

Under the terms of the deal, Expedia will offer to acquire each outstanding share of HomeAway’s common stock […] The post Expedia to Buy HomeAway for $3.9 Expedia, based in Bellevue, Washington, announced Wednesday plans to buy Austin-based HomeAway in a deal worth about $3.9 billion. Billion appeared first on SiliconHills.

How to Raise Investor Funding for Your Startup

Early Growth Financial Services

We recently participated in a panel discussion and workshop at Ubifrance. Nicolas L.

If I Launched a Startup

The Startup Lawyer

4) Type of Shares: Common Stock. (5) 5) Par Value of Common: $0.0001. (6) Here’s what I’d do in the beginning: Incorporation. (1) 1) Entity Choice: Corporation or Corporation. (2) 2) State of Incorporation: Delaware. (3) 3) Authorized Shares in Charter: 10,000,000 Shares. (4) 8) Vest Founders Shares?: Hell Yes. (9)

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How do startups decide who sits on the board?

Gust

In a larger startup post Series A or B, the board might be expanded to five people, with two directors chosen by the Common stock holders (the founders), two by the investors (often one by each of two VC funds), and one independent director agreed to by everyone. original post can be found on Quora @ [link] *.

In defence of liquidation preferences

The Equity Kicker

Additionally, they introduce a small amount of complexity and an element of misalignment between the investor and the common stock holder (usually the founder). I just read a New York Times article that led with the sentence “Deep inside a Silicon Valley unicorn lurks a time bomb”. Startup general interest

Payment Data Systems to Begin Trading on the NASDAQ Stock Market

SiliconHills

San Antonio-based Payment Data Systems, which processes online payments for other companies, announced Tuesday that it has received confirmation that its common stock will begin trading on the NASDAQ Capital Market starting Aug. San Antonio Akimbo FiCentive Nasdaq Payment Data Systems

Startup Financing: Overview of Preferred Stock

Early Growth Financial Services

From time to time on Founders Workbench we give a brief primer on common terms and issues in venture financings. This post by Ian Engstrand first appeared on Founders Workbench. management). Participating versus non-participating: what’s the difference?

How do venture capitalists feel about following a crowdfunding capital raise?

Gust

This was one of the primary subjects for discussion at Venture Forward 2012 ( ventureforwardconference.com ). But I’m sure there will be many, many stories of all kinds once the final provisions go into effect in January, and it will take quite a while for this all to shake out. original post can be found on Quora @ : [link] *.

Legal Basics: Fully-Diluted Capital

VC Ready Blog

To take a simple example, let’s say a company’s capitalization looks like this: Authorized Capital: 1,000,000 shares consisting of: 800,000 shares of common stock; and. 200,000 shares of preferred stock that converts to common at a ratio of 1:1. Issued and Outstanding Capital: 500,000 shares of common stock.

Founder’s Stock Is Gold, If You Know The Rules

Startup Professionals Musings

Here are some typical special terms and considerations for Founder’s stock: Negligible real value. Stock dilution control.

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Rally Gives $1.3 Million To The Boulder Community

Feld Thoughts

My day started out great. I remember numerous conversations with Ryan about this. But Ryan’s vision was always bigger than that.

Some Thoughts On Founder Liquidity

A VC : Venture Capital and Technology

I also saw this tweet from Sam Altman yesterday: if founders are selling their own stock less than 1 year into the company, you can nearly always safely pass on investing. — I saw a post last week that suggested that VCs competing to win deals is leading to excess amounts of founder liquidity. It may happen but it is certainly not rampant.

Are Standard Venture Capital Financing Rounds Up To Speed With The Latest Trends For Going Public?

Recent Buzzes - VC Experts, Inc.

In contrast, standard venture capital deal terms are geared towards a pre-IPO conversion of all classes into common stock Google recently made headlines with an announcement that it is planning on splitting its shares and creating a new class of shares without voting rights.

IPO 15

7 Investor Term Sheet Demands Startups Need Not Fear

Startup Professionals Musings

For later investments, the price is equity, with a percentage of the owner stock to be assigned to the investor. This is normal and fair to all.

Global Cash Access Acquires Austin-based Multimedia Games for $1.2 Billion

SiliconHills

Global Cash has agreed to acquire all outstanding common stock of Multimedia Games for $36.50 per share, 31 premium from the stock’s close on Sept. The news sent Multimedia Games’ stock which […] The post Global Cash Access Acquires Austin-based Multimedia Games for $1.2 for $1.2 billion in cash.

allensblog: "Fully-Diluted"

Allen's Blog

This, plus the informal way the term is used in venture financings, puts a premium on the parties explicitly agreeing to a commonly-understood definition. The number of shares of Common Stock that would be outstanding if all stock options reserved for future grant were actually granted and fully exercised. allensblog.

Convertible Debt – Warrants

Ask The VC

There are numerous different ways to calculate this, such as: $20,000 worth of common stock at the last value ascribed to either the common or preferred stock; $20,000 worth of the last round of preferred stock at that’s rounds price of the stock; or. In this case the investor will get a warrant for $20,000.

How to Protect Your Startup Founder’s Shares

Startup Professionals Musings

Here are some typical special terms and considerations for founder’s stock: Negligible real value. Stock dilution control.

Second-Class Investor Citizens: Facebook’s IPO and Dual-Class Equity Structures

Gust

Options and warrants, when issued, are also typically exercisable for shares of Common Stock.

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Nobody Is Crying For You When You Are Worth Billions

A VC : Venture Capital and Technology

When an investor like Fidelity puts tens of millions of cash into Spotify at a $3bn valuation, they are not buying publicly traded common stock that will go up and down with the value of the company. I did a talk with Bill Werde at Billboard's FutureSound conference a few weeks ago. The entire talk is online (in two parts) here.

Bad Notes on Venture Capital

Both Sides of the Table

If you’re wildly successful early on or if they help you achieve a great valuation they actually pay a significant price for their eventual stock even though they took much more risk than a future investor and backed you early. Less than you’ll probably grant your most junior employees in stock options? Stock Option plans.

An Advisor Equity and Advisor Pool Breakdown

Eric Friedman

I have been sharing the below with folks via email and privately, but realized I should do so publicly**. Think about the things you DON’T know.

Is convertible debt with a price cap really the best financing structure?

Startup Company Lawyer

In fact, it seems very rare to see a convertible note without a price cap these days, although it was fairly common to raise convertible debt without a price cap a couple of years ago. A logical alternative to convertible debt is a priced Series A preferred stock financing. Seth Levine asks, “ Has convertible debt won?

Founder’s Stock Is Gold, If You Know The Rules

Gust

Here are some typical special terms and considerations for Founder’s stock: Negligible real value. Stock dilution control.

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Is My Company Really Worth More Than The New York Times?

Fresh Inc.: The Staff Blog

Public company valuations are usually determined by common stock. These benefits make preferred shares more expensive than common stock.

You Got To Be In It To Win It

A VC : Venture Capital and Technology

They used to be more common twenty five years ago when I entered the venture capital business. This requirement to exercise upon departure is a big reason why the secondary market in employee common stock has taken off. That's how Skype's option plan is described in this piece by Felix Salmon. This is a tricky area.

Bad Notes on VC

Gust

If you’re wildly successful early on or if they help you achieve a great valuation they actually pay a significant price for their eventual stock even though they took much more risk than a future investor and backed you early. Less than you’ll probably grant your most junior employees in stock options? Stock Option plans.

Later-stage rounds and “setting the bar too high”

Chris Dixon

Preferred shares behave like a stock on the upside and a bond on the downside. These CEOs are worrying too much. startups

Anatomy of a Term Sheet: Conversion and Anti-dilution

VC Ready Blog

In this post we look at when an investor’s preferred stock may or must convert to common stock, and how the conversion ratio may be adjusted in certain circumstances. Preferred stock typically converts to common stock either: (a) at the option of the stockholder (“Optional Conversion”); or. (b)

Everything You Ever Wanted to Know About Convertible Note Seed Financings (But Were Afraid To Ask) – Part 1

Scott Edward Walker

ii) why are convertible notes issued instead of shares of common or preferred stock? This post was originally published on TechCrunch.]