Startup Company Lawyer
MARCH 14, 2010
After the recent announcement of the Series Seed Financing documents by Marc Andreesen, Brad Feld points out that there are now four sets of “open source&# equity seed financing documents: TechStars Model Seed Funding Documents (by Cooley). Y Combinator Series AA Equity Financing Documents (by WSGR). under $500K).
Both Sides of the Table
SEPTEMBER 5, 2012
To better understand the arguments for / against convertible equity I suggest you read my posts on those topics: Is convertible debt preferable to equity? Was Paul Graham right in his “high resolution” financing post? Convertible Notes Also Can Have Multiple Liquidation Preferences. That’s right.
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Tim Keane
JANUARY 12, 2010
For angel groups, the distinction between groups and VCs on this issue is dwindling, especially as angel groups do bigger rounds of financing. Note that this applies only to earl stage Series A-type equity financings and assumes no cash dividends are paid to investors. Second a liquidation preference and a participation.
Feld Thoughts
JUNE 2, 2015
Or, if you just want the paragraph, it’s: “If this note converts at a price higher than the cap that you have been given you agree that in the conversion of the note into equity you agree to allow your stock to be converted such that you will receive no more than a 1x non-participating liquidation preference plus any agreed interest.”.
The Startup Lawyer
JUNE 9, 2010
A startup’s Series A financing shouldn’t be a large liquidity event or salary payday for the startup’s founders. The term sheet was pretty much a done deal, when the startup’s CEO demanded a salary of $25,000. Not all startup founders understand this tenet. Case Study.
Scott Edward Walker
JULY 27, 2011
There are, however, certain formal procedural requirements that the stockholder must comply with, including making a written demand upon the corporation, “under oath” and stating a “proper purpose.” The board can either accept or reject the demand. Moreover, there are certain tricky evidentiary issues.
ithacaVC
MAY 1, 2013
The article states “When venture capitalists invest, they typically demand preferred shares that accrue a yearly dividend of about 8 percent. It is ONLY once the VC’s liquidation preference is cleared that the common stock held by founders and employees is worth anything. Here are a few other thoughts: 1.
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