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Accepting Outside Investors? Here Are 5 Things to Watch Out for in Your Contract

Up and Running

The version of “anti-dilution protection” that most benefits outside investors is commonly called a “full ratchet.” As a middle ground on the “anti-dilution clause” you should be pushing for what’s called a “partial ratchet.” As the small business owner, the goal is just to understand how to negotiate the clause to serve you best.

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Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

  In a bottom up approach, the forecast is built from actual user projections. A liquidation preference means that the investors receive their investment back (plus dividends) prior to a distribution of the proceeds to stockholders.   In a bottom up approach, the forecast is built from actual user projections.