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

Tim Keane

Term-sheets and Valuations: Thinking about Negotiations. Please see later version of this post on May 16, 2010 Entrepreneurs are often not experts in the area of term-sheet negotiations and all of the surrounding issues.   Investors sometimes “present” the terms they’d like and expect the entrepreneurs to react.

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Flexible VC, a New Model for Companies Targeting Profitability

David Teten

From RBI, Flexible VCs borrow the ability to reap meaningful returns without demanding founders build for an exit. Yes, via conversion rights at a valuation cap. Yes, via conversion rights at a valuation cap. Santa Clara University shares their demand dividend structure. . Flexible VC: Compensation-based.

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The Legal Side of Entrepreneurship

YoungUpstarts

This article highlights their advice on issues ranging from financing to patent trolls: While startups may believe lawyers are too costly, working with one early on avoids potentially serious problems later. Entrepreneurs need to hit a happy medium with backers, not giving away too much but not making overly aggressive demands.

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Why Confidence is So Important in Fund Raising

Both Sides of the Table

He was in a later-stage financing round and was talking with many investors. I told him, “I know we don’t yet have a term sheet so you feel you need to listen to everybody’s request. But imagine you were expecting two term sheets imminently. How would you act then? even if they don’t acknowledge it to themselves.”

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Knowledge Is Power: Convertible Note Financing Terms, Part III

Gust

Last week , we took the plunge and began dissecting an example term sheet for a convertible debt financing round piece by piece. I’ll continue with more specific terms and wrap up next week with some thoughts about recent changes and trends for the future. First, a word about the maturity date.

Finance 107
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What is convertible equity (or a convertible security)?

Startup Company Lawyer

One major concern about convertible debt is that it eventually needs to be repaid if another round of financing doesn’t occur. ” If the company didn’t raise a round of financing, the convertible debt would convert into the last round of financing (i.e. Form of Convertible Security Term Sheet.

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How Many Investors Should You Talk to in a VC Fund Raise? And How Do You Prioritize?

Both Sides of the Table

If an investor isn’t engaging then they’re not suddenly going to get a term sheet. People who believe the former believe that you should see the market demand before too many people know you’re “in market.” You can short-hand this as “engagement.” I think there’s some truth in this. This is the exception, rather than the rule.