Pascal's View

JULY 9, 2017

Andrew Krowne and I recently co-wrote an article in Tech Crunch , Why SAFE Notes Are Not Safe for Entrepreneurs. At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors. Many entrepreneurs lose track of what they have been cooking up in the cap table.

Post-Money Valuation 49

Post-Money Valuation Valuation Cap Table Covenant 49

Both Sides of the Table

APRIL 19, 2011

He tells the story of how he was out of cash, stressed out, nobody in LA or Silicon Valley would give him money, he had finally found an investor in Minneapolis but his venture bank was going to shut him down for breaking a “covenant&# in their agreement by not having enough cash in the bank. The answer? combination of factors –.

Acquisition 304

Acquisition Warrant Customer Term Sheet 304

Up and Running

APRIL 2, 2015

One of the first things overly-optimistic entrepreneurs discover as they look for funding is that banks don’t fund business plans. Most commercial loan include what we call loan covenants, in which the company agrees to keep some key ratios —quick ratio, current ratio, debt to equity, for example—within certain defined limits.

Balance Sheet 60

Balance Sheet SBA Covenant Technical Review 60

Austin Startup

DECEMBER 7, 2017

To solve this, VCs and entrepreneurs need a quick and easy way to provide seed funding, without a long, drawn out negotiation, onerous debt covenants, or a crazy valuation that could hurt the investor and/or the entrepreneur. Two sides of the same intractable coin. It sits on your balance sheet as a form of equity.

Covenant 48

Covenant Cap Table Early Stage SBA 48

Tim Keane

MARCH 9, 2011

But, what constitutes success for the parties involved – investors, entrepreneurs, employees, and customers – can vary dramatically. Misaligned interests that lead to poor financing choices are often very problematic for first time entrepreneurs in young companies.    Appropriate covenants. Possibilities: 1. 

Finance 83

Finance Bootstrapping Startup Equity 83

YoungUpstarts

JUNE 28, 2017

Before you open the doors to a new life as an entrepreneur and long before you start picking out your first BMW, experts agree that a solid business plan is a vital platform for any aspiring business. Restrictive covenants to prevent the seller opening up in immediate competition. Conveyancing.

Covenant 113

Covenant Due Diligence Social Media Australia 113

Pascal's View

DECEMBER 17, 2012

It is critical to know the state of the art in merger terms leading to an acquisition and in post-merger covenants, particularly with respect to the release of cash consideration held in escrow or as a holdback by the buyer.

Acquisition 38

Acquisition Merger Covenant Liquidity Event 38

David Teten

AUGUST 1, 2019

Structuring and Negotiating Executive Compensation Packages: Addressing Pay, Severance, Restrictive Covenants, and More. Introducing our guide to stock options for European entrepreneurs. Negotiating Employment with a Private Equity Firm – 7 Surprises to Expect. Executive Compensation & Severance. Any data on grant sizes.

Private Equity 60

Private Equity Equity Due Diligence Portfolio 60

David Teten

SEPTEMBER 10, 2019

Structuring and Negotiating Executive Compensation Packages: Addressing Pay, Severance, Restrictive Covenants, and More. Introducing our guide to stock options for European entrepreneurs. Negotiating Employment with a Private Equity Firm – 7 Surprises to Expect. Executive Compensation & Severance. Any data on grant sizes.

Due Diligence 60

Due Diligence Stock Options Covenant Private Equity 60

Lightspeed Venture Partners

DECEMBER 10, 2012

Astonishingly, the entrepreneurs took the deal. This was a crazy deal for the entrepreneurs to take. The entrepreneurs did say that they wanted the business expertise of one of the sharks. Banks often have operating covenants for their loans that require the company to be hitting plan, or close to it.

Covenant 162

Covenant Warrant Southern California Los Angeles 162

YoungUpstarts

MARCH 14, 2012

EBITDA is often used in loans covenants. On the other hand, if you’re obsessed with your ROI, you’re probably an entrepreneur that’s using other people’s money. EBITDA, or Earnings Before Interest, Taxes, Depreciation, and Amortization, is a metric of measurement of cash earnings that is generally non-GAAP.

Non-disclosure Agreement 202

Non-disclosure Agreement NDA IPO Covenant 202

YoungUpstarts

JUNE 19, 2018

One of the most crucial hidden truths about the community comeback is who’s driving it: civic-minded entrepreneurs and private citizens of every stripe. Pensacola used a Covenant for the Community to guarantee that contractors would use local minorities in the revitalization of downtown.

America 100

America Community Covenant Metrics 100

Berkonomics

FEBRUARY 9, 2010

We have previously made the case that professional investors demand more in the form of restrictive covenants and lower valuations. Whether this business and entrepreneur make it to the rare billion dollar club or not, without the VC guidance there would have been little opportunity to even dream of such a goal.

Covenant 59

Covenant Angel Investor Valuation Later Stage 59

dashes.com

SEPTEMBER 17, 2011

But for individual entrepreneurs who just have a good idea and big dreams, its easy to be misled into thinking that walking in the door with a fancy legal document makes you look professional or "serious". The same goes for "non-competes" or non- solicitation covenants. What is amateurish is presenting poorly written or lopsided ones.

NDA 52

NDA Technical Review Non-Compete San Francisco 52

BeyondVC

JUNE 11, 2007

In addition, while most associate venture debt with investments in companies with core technology, more and more venture debt firms are back and willing to offer capital to earlier stage web-based companies with no financial covenants and MAC (material adverse change) clauses. Why can raising venture debt be great?

Intellectual Property 60

Intellectual Property Covenant Warrant Equity 60

Gust

OCTOBER 26, 2011

The Notes will be issued pursuant to a definitive Note Purchase Agreement containing customary covenants, representations and warranties of the Company. I hope you’ve enjoyed reading thus far and would love to hear from entrepreneurs or investors with any questions or comments.

Finance 79

Finance Term Sheet Covenant Accredited Investor 79