YoungUpstarts

FEBRUARY 1, 2020

by Bryce Welker, founder of Crush The CPA Exam. Before your financial statements can be filed with the SEC or distributed outside of your business, an external auditor must ensure your records adhere to GAAP. These are: Revenue Recognition issues. Share-based Compensation. Accounting for Income Taxes.

CPA 165

CPA Stock Options Valuation Stock 165

Scott Edward Walker

MAY 15, 2012

Part 2, entitled “ Convertible Note Seed Financings: Econ 101 for Founders ,” addressed the economics. This part will address certain tricky issues. What Happens If a Startup is Acquired Prior to the Note’s Conversion to Shares of Preferred Stock? This is another tricky issue. Using our example above, and assuming a 1.0x

Finance 64

Finance Founder Accredited Investor Preferred Stock 64

Gust

APRIL 11, 2014

Let’s get right down to business: Dilution of founders’ and other early shareholders’ equity in startups is frequently a subject of intense interest and debate. Yet what matters fundamentally is economic dilution : Will adding newly issued shares make existing shares less valuable, and if so, by how much?

Dilution 162

Dilution Equity Pre-Money Valuation Prospectus 162

Scott Edward Walker

JUNE 9, 2011

As many of you know, VC investors are typically issued shares of preferred stock, not common stock. For example, let’s assume that the Series A investor has a $5 million, non-participating liquidation preference (with a 2x multiple) representing 30% of the outstanding shares of the company, and the company is sold for $100 million.

Term Sheet 60

Term Sheet Conversion Rights Venture Capital Liquidation Preference 60