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Venture Capital Q&A Session

Both Sides of the Table

The downside is that people need to buy their stock. I talked also about 409a valuations and why common stock purchases cost less than preferred stock purchases. There’s some stuff here that I even prefer not to put into writing. Second – don’t send unsolicited emails to VCs.

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Corporation or LLC? Business Organizations for Tech Startups.

YoungUpstarts

Stocks are issued at the time the company is formed, and more can be issued over time. You can control the power of your company’s stock by issuing different classes. She can be reached at 310.564.2670 or by email at ckirchner@mrllp.com. The ownership structure of an LLC is a blank slate. For more, please visit www.mrllp.com.

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Startup Funding – A Comprehensive Guide for Entrepreneurs

ReadWriteStart

The shares given out can either be common stocks or preferred stocks. ? Debt investment. One can also proactively reach out to investors by sending them emails with the teaser document and follow up for a meeting. Equity investment is the most popular and most talked-about avenue for startup funding.

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What if you and your investors don’t agree on an exit?

Berkonomics

There are clauses in preferred stock investment agreements allowing the investor in many cases to “put” the shares back to you at the purchase price plus dividends or more after a period, usually five years, if no effort is made to find a buyer or begin the IPO process. The advantage of creating an evergreen company.

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How do you pay an early stage board?

Berkonomics

The option price should be set by appraisal under IRS rule 409a, and certainly should be low enough to recognize that common stock options are not worth as much as preferred stock, given the many preferences of the latter.

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VC investors: Don’t be greedy even if you can.

Berkonomics

Most sophisticated investors will take either a promissory note or preferred stock, both of which come before founder or management stock in a sale or liquidation. The order of liquidation or payout. Here’s an example that will make your heart skip a beat.

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Equity for Consultants – Keep it Simple!

www.mattbartus.com

At the very least, shoot them an email thanking them for their services and confirming that the agreement is terminated (but make sure you comply with the termination provisions of the consulting agreement). Share this: Facebook Email Reddit StumbleUpon. Send to Email Address. Your Email Address. Bartus | Disclaimer.

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