Both Sides of the Table

JUNE 5, 2011

2 preamble issues having read the comments on TC today: 1: I know that the prices of startup companies is much great in Silicon Valley than in smaller towns / less tech focused areas in the US and the US prices higher than many foreign markets. This article originally appeared on TechCrunch. I acknowledged this in the article.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

View from Seed

APRIL 30, 2015

Below, we talk to Glen Mello , Managing Director of Silicon Valley Bank’s accelerator team in Boston. NVV: Is there any dilution? GM: There are warrants attached to these loans, but it’s a pretty nominal dilution and pretty low cost of capital for an entrepreneur, which is usually part of the appeal.

Term Sheet 120

Term Sheet Equity Startup Seed Stage 120

Both Sides of the Table

SEPTEMBER 10, 2021

The legends of Silicon Valley?—?two A-Rounds used to be $3–7 million with the best companies able to skip this smaller amount and raise $10 million on a $40 million pre-money valuation (20% dilution). Today you have funders focused exclusively on “Day 0” startups or ones that aren’t even created yet. two founders in a garage?—?(HP

Pre-Money Valuation 471

Pre-Money Valuation Valuation Venture Capital Early Stage 471

ReadWriteStart

JANUARY 27, 2011

I have discussed at length why revenue sharing channel deals may serve as perfectly fine alternatives to raising equity (or even complements) because of their non-dilutive nature. For a more elaborate explanation of the deal, please read my blog post 1M/1M: Alternative Financing For Startups Using A Sales Channel Partner.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

thebarefootvc

MAY 8, 2012

This is also what I advise entrepreneurs when discussing dilution and valuation — think of the bigger picture and the end game of what you are looking to build — and who will help you get there.

Venture Capital 78

Venture Capital Syndicate Syndication Bandwidth 78

David Teten

AUGUST 19, 2019

Benefits: Non-dilutive, flexible credit offerings that fit SMB or enterprise SaaS. Additionally, portfolio companies are able to access competitive and often non-dilutive financing by monetizing an unavoidable expense that is being paid to its current processors, thus yielding a mutual benefit for both parties. over next 12 months.

Revenue 60

Revenue Technical Review Software Review Equity 60

Startup Professionals Musings

DECEMBER 27, 2014

Examples of some leaders in this space include Ron Conway in Silicon Valley and Brian Cohen , chairman of the New York Angels, who each may have over 500 startups in their portfolio. This can cause early investor dilution, lower ultimate returns or leave the startup stranded.

Angel Investor 260

Angel Investor Silicon Valley Startup Portfolio 260

Pascal's View

OCTOBER 11, 2013

But I am coming to the Museum to talk about the leading of edge of startup financing in the digital age and about real time investment risk management in the new Wild West– crowd-funded Silicon Valley post the lifting of the ban on General Solicitation.

New York 31

New York Technical Review Angel Investor Finance 31

The Equity Kicker

NOVEMBER 9, 2016

I just read a New York Times article that led with the sentence “Deep inside a Silicon Valley unicorn lurks a time bomb”. That trade gives them less dilution and therefore more cash in upside scenarios but less cash (and potentially nothing) in extreme downside scenarios.

Liquidation Preference 122

Liquidation Preference Silicon Valley Participating Preferred Common Stock 122

Both Sides of the Table

OCTOBER 7, 2014

A rounds back then seemed to be anywhere from $2-3 million (LA or NYC) or up to $5 million in Silicon Valley. $5 There weren’t a lot of seed funds in 2007 so this was often done by angels, funding consortia or sometimes early-stage funds that existed then (First Round Capital, True Ventures, SoftTech VC, etc.). Why the latter?

Cap Table 399

Cap Table Silicon Valley Term Sheet Finance 399

Agile VC

MAY 9, 2014

Such an approach is common in Silicon Valley… Google, Facebook, LinkedIn, and others have dual-class equity structures which give the holders of one class of shares (typically founders) disproportionate voting rights relative to their fully-diluted ownership stake in the company.

Government 153

Government Silicon Valley China Cofounder 153

ReadWriteStart

SEPTEMBER 10, 2010

You can get cash without diluting your ownership in the company. Sramana Mitra is a technology entrepreneur and strategy consultant in Silicon Valley. Most entrepreneurs have no choice but to avail of this sort of financing along with the mentoring and the contacts that could come with it (doesn't always come along, though).

Cloud 115

Cloud Silicon Valley Incubator Finance 115

Both Sides of the Table

APRIL 25, 2011

There’s a line of thinking in Silicon Valley that you should build product businesses rather than services businesses. It’s how things are done across the country outside of Silicon Valley. This post originally appeared on TechCrunch. It’s nearly impossible to get a services company financed by VCs.

Silicon Valley 332

Silicon Valley IP Dividend Finance 332

www.mattbartus.com

SEPTEMBER 24, 2011

A View from the Valley. Perspectives on issues affecting founders, startups and investors from a veteran startup lawyer in Silicon Valley. We will grant him/her X% fully diluted shares up front, and every time he/she makes an introduction, he/she will vest in 100 shares.” Blog blog archive. Quora Answers.

Equity 40

Equity Vesting Silicon Valley Intellectual Property 40

K9 Ventures

JUNE 12, 2012

Some days in Silicon Valley it feels like there are more investors than there are entrepreneurs. Founders typically get their equity in a company once — at the time of founding and then get diluted with each subsequent round of financing. And there absolutely are more investors than there are good deals.

Venture Capital 117

Venture Capital Silicon Valley Founder Seed Stage 117

K9 Ventures

JUNE 12, 2012

Some days in Silicon Valley it feels like there are more investors than there are entrepreneurs. Founders typically get their equity in a company once — at the time of founding and then get diluted with each subsequent round of financing. And there absolutely are more investors than there are good deals.

Venture Capital 105

Venture Capital Silicon Valley Founder Seed Stage 105

Both Sides of the Table

MAY 9, 2011

So embedded is this conventional wisdom in Silicon Valley that it feels like heresy to even question it. Conventional wisdom says that you gain far more in working as a team than you lose by diluted by half before you start. It’s only 3 minutes, 44 seconds. I covered what I call “the co-founder mythology.&#

Cofounder 393

Cofounder Founder Vesting Founder Vesting 393

Both Sides of the Table

SEPTEMBER 25, 2011

Pro-rata rights are designed to protect investors from being diluted in future rounds of financing, which is an important way for VCs to protect the investments they make early that turn out to be super successful. These investors often have internal policies that dictate that they own a minimum percentage of a company in which they invest.

Entrepreneur 310

Entrepreneur Dilution Finance Silicon Valley 310

Hunter Walker

MARCH 14, 2019

Hunter’s draft script for SVU: Silicon Valley. Even at the cost of a little more dilution. Again, I think it’s worth taking a little more dilution than you planned if needed to get this round done as soon as you’re ready. There’s lots of movement in the venture world these days.

Cap Table 95

Cap Table Dilution Silicon Valley Portfolio 95

Scott Edward Walker

AUGUST 31, 2011

Answer Welcome to the world of the Silicon Valley! As the late, great attorney Craig Johnson wrote in the book The Silicon Valley Edge: A Habitat for Innovation and Entrepreneurship : Although start-up lawyers in Silicon Valley draft documents and follow form books. Any advice would be appreciated.

Silicon Valley 45

Silicon Valley Term Sheet Liquidation Preference Redemption 45

Steve Blank

APRIL 10, 2019

In tech startups stock options were here almost from the beginning, first offered to the founders in 1957 at Fairchild Semiconductor , the first chip startup in Silicon Valley. It drove the relentless “do whatever it takes” culture of 20 th century Silicon Valley. Why Startups Offer Stock Options. And the bet worked.

Stock Options 333

Stock Options Stock Vesting Common Stock 333

Austin Startup

MARCH 7, 2021

In 2019 and 2020, we saw hundreds of millions of dollars in non-dilutive funding go to Texas startups, most of which had never worked with the government before. The second wave of companies were mainly concentrated in Silicon Valley, and coincided with the rise of platforms (Google, Facebook, etc.)

Texas 90

Texas San Antonio Houston Dallas 90

Lightspeed Venture Partners

NOVEMBER 19, 2012

Season 4 of week 10 of Shark Tank was interesting because two of the pitches were for internet businesses that I could imagine seeing in my day job as a Silicon Valley Venture Capitalis t. I cover one of them, for Nearly Newlyweds, over at Entrepreneur.com. The other one was for a company that describes itself as Netflix for neckties.

Pre-Money Valuation 161

Pre-Money Valuation Alabama Valuation Churn Rate 161

Both Sides of the Table

MARCH 11, 2010

I’ve even heard people repeat this bullsh*t Silicon Valley mantra about “failing fast&# which is horse puckey. I think that if you’re offered fair terms that aren’t destructively dilutive, preserve options for an exit, don’t put undue pressure on your company to do things too quickly you TAKE THE MONEY.

Venture Capital 319

Venture Capital Startup Silicon Valley Warrant 319

Agile VC

JULY 11, 2012

Brentwood Associates [Silicon Valley] –> Founded in the early 70s and focused primarily on VC, Brentwood had big wins in both IT like Wellfleet Communications (big chunk of what eventually became Nortel) and WebTV (part of Microsoft) and healthcare (various businesses that make up a big chunk of what is now Medtronic and Baxter).

Silicon Valley 240

Silicon Valley Carried Interest Cofounder Boston 240

Startup Lessons Learned

AUGUST 24, 2009

And as everyone’s attention starts to focus on those same indicators, their value is being diluted. Most publishers are still caught up in an outdated “vision vs. metrics&# argument, which is already obsolete here in Silicon Valley. Which leads to the next problem: We need new status indicators.

San Francisco 113

San Francisco Lean Technical Review Distribution 113

Austin Startup

SEPTEMBER 10, 2017

SAFEs and Notes are optimized for speed and simplicity, with a cost of future uncertainty and dilution. There is a mindset in parts of the startup world — and very much coming out of Silicon Valley — that promotes the idea that startup legal documentation should all be standardized and closed as fast as possible, with minimal fuss.

Valuation 48

Valuation Dilution Silicon Valley Seed Stage 48

Startup Lessons Learned

JULY 26, 2011

When I came to Silicon Valley, I was inducted into a body of accumulated wisdom about how to handle them. I hope all of you who are reading this - no matter where you live, no matter what kind of company you have - will one day get to make the pilgrimage to Sand Hill Road in Silicon Valley, or another famous startup hub.

Antidilution 148

Antidilution Term Sheet Silicon Valley Widget 148

Venture Chronicles

MAY 26, 2010

Back in March, Ben Horowitz of Andreessen Horowitz wrote a post called The Case For The Fat Startup, where he outlined some of the reasons why a fledging company might want to consider taking a large amount of funding — a strategy that contrasts with the ‘lean startup’ model that has become common in Silicon Valley.

Lean 40

Lean Early Stage Valuation Startup 40

Gust

OCTOBER 8, 2014

A-rounds back then seemed to be anywhere from $2-3 million (LA or NYC) or up to $5 million in Silicon Valley. $5 There weren’t a lot of seed funds in 2007 so this was often done by angels, funding consortia or sometimes early-stage funds that existed then (First Round Capital, True Ventures, SoftTech VC, etc.). Why the latter?

Cap Table 136

Cap Table Silicon Valley Term Sheet Non-Compete 136

The Equity Kicker

MARCH 17, 2015

Big picture this increased capital efficiency is great for entrepreneurs because they suffer less dilution, but it does mean they have to do things they aren’t skilled at. Over the last fifteen years that has become accepted best practice. The opportunity for investors is to help fill the gaps.

Early Stage 60

Early Stage Venture Capital San Francisco Silicon Valley 60

David Teten

DECEMBER 2, 2019

Nearly every major Silicon Valley venture-capital firm has now invested in a B Corp ; maybe you will be one of them! I’m now researching non-dilutive funding for Action Tank , a startup I’m gestating to “Make America Functional Again”. Non-Dilutive Financing: Everything You Need to Know. Congratulations!

Technical Review 60

Technical Review SBIR Dilution Silicon Valley 60

Scott Edward Walker

OCTOBER 28, 2014

This week, we present legendary angel investor Ron Conway (commonly referred to as the “ Godfather of Silicon Valley ”) and Marc Andreessen , a brilliant entrepreneur and co-founder and general partner of the venture capital firm Andreessen Horowitz. These guidelines are important – the 10% to 15% [for an angel round].

Cap Table 67

Cap Table Cofounder Silicon Valley Venture Capital 67

Hippoland

APRIL 10, 2016

Standard vesting practices in the Silicon Valley at this time of writing are 4 year vesting with a 1 year cliff. You will all be diluted down considerably, so even if you are ok with 20-33% stake now, that is not what you will actually end up with if you raise a few rounds of funding.

Cofounder 48

Cofounder Cap Table Equity Vesting 48

Both Sides of the Table

APRIL 3, 2010

They said that they didn’t want the extra money or dilution. True was my top pick in Silicon Valley. My very first seed deal was a company that told me flat out that they didn’t want to raise more than $500k. We offered them more : $750k-1 million. We took the $500k. How did it go so quickly?

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

This is going to be BIG.

APRIL 2, 2012

At least if you and some Silicon Valley VC get inked up in one of the breakout rooms, you can get it removed more quickly than you can get out of an investment relationship. Similarly, picking seed investors for your first startup in and around the craziness of an accelerator demo day can be just as scarring over the long term.

Silicon Valley 115

Silicon Valley Flash Dilution Portfolio 115

The Next Web

JANUARY 24, 2014

Think of Stanford and Sandhill road in Silicon Valley, Route 128 in Boston or IIT in Bangalore India. It could be an urban area where several startups settle (think Silicon Alley in London) or a grass roots organization like the famous ‘ home-brew computer club ‘ or even a hipster coffee place like Berlin’s Oberholz cafe.

Netherlands 143

Netherlands Technical Review Stock Silicon Valley 143