Cost, Demand, Ratchet and Reputation

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The Truth About Convertible Debt at Startups and The Hidden Terms You Didn’t Understand

Both Sides of the Table

SEPTEMBER 5, 2012

Because convertible debt deals often have both a ‘full ratchet’ and often have ‘multiple liquidation preferences’ “ Yup. The key for entrepreneurs to understand is whether it’s a “full ratchet” or a “weighted average ratchet.” Convertible notes have full ratchets.

Ratchet

Ratchet Liquidation Preference Equity Stock

On the Road to Recap:

abovethecrowd.com

APRIL 20, 2016

In Silicon Valley boardrooms, where “growth at all costs” had been the mantra for many years, people began to imagine a world where the cost of capital could rise dramatically, and profits could come back in vogue. They use the reputation of the other investors as a proxy for due diligence. Why are they friendly now?

IPO

IPO Term Sheet Silicon Valley Valuation

StartUpRoar

The Truth About Convertible Debt at Startups and The Hidden Terms You Didn’t Understand

On the Road to Recap:

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