Steve Blank
APRIL 26, 2022
Cram downs are back – and I’m keeping a list. Except, that is, for the bottom feeders of the Venture Capital business – investors who “ cram down ” their companies. They offered desperate founders more cash but insisted on new terms, rewriting all the old stock agreements that previous investors and employees had.
Startup Professionals Musings
OCTOBER 10, 2014
In the interim, there is no market for the shares, and no dividends or interest. That means writing down and signing the terms of the agreement, after making sure everyone understands them. Insist on paying market rates for commercial loans, since the IRS can instigate some nasty consequences on “gifts.”
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Both Sides of the Table
APRIL 20, 2011
They have totally changed the way you run a VC firm, investing heavily in systems & events for their founders that are pushing the boundaries of the way our industry works. The discussion with Howard Morgan starts off by acknowledging Josh Kopelman as a co-founder of First Round Capital. I'm a huge fan of this innovation.
Startup Professionals Musings
MARCH 22, 2020
In the interim, there is no market for the shares, and no dividends or interest. That means writing down and signing the terms of the agreement, after making sure everyone understands them. Insist on paying market rates for commercial loans, since the IRS can instigate some nasty consequences on “gifts.”
Both Sides of the Table
MAY 5, 2013
” In the article I discussed the downside of raising capital at a too high of a price and referred people to a previous article I had written encouraging founders to raise “ At the Top end of Normal ” as opposed to stratospheric prices. First, a down round sends a signal that something is wrong with your company.
Steve Blank
NOVEMBER 2, 2009
In times when venture capital is hard to get, investors extract high costs for failure (down-rounds, cram downs , new management teams, shut down the company.) Marketing demand creation programs (Search Engine Marketing, Public Relations, Advertising, Lead Generation, Trade Shows, etc.)
Startup Professionals Musings
MARCH 9, 2018
In the interim, there is no market for the shares, and no dividends or interest. That means writing down and signing the terms of the agreement, after making sure everyone understands them. Insist on paying market rates for commercial loans, since the IRS can instigate some nasty consequences on “gifts.”
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