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Flexible VC, a New Model for Companies Targeting Profitability

David Teten

Eligible for favorable treatment under Qualified Small Business Stock exemption, if structured as equity. This applies if the investment converts into common stock; details are beyond this essay’s scope. See Why Are Revenue-Based Investors Investing in Women & Diverse Entrepreneurs? That said, nothing is cost-free.

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Cliff Notes S-1: Kayak ? AGILEVC

Agile VC

Obviously most of these employees are working hard primarily for equity upside compensation, but Kayak’s personnel costs are roughly $200K/head so the company is highly productive on a per employee basis. Interesting to note that Hafner and English own common stock but also made meaningful investments in the Series A & B rounds.

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Facebook S-1: The Most Anticipated IPO in a Decade ? AGILEVC

Agile VC

These companies report gross ad revenue but then subtract out “TAC” (Traffic Acquisition Costs) which is basically accounting-speak for the revenue share they pay to the partner sites where the ads actually appear. Im a former Silicon Valley entrepreneur turned East Coast VC. billion in cash profit last year. Read More ».

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